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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2108/270
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| Title: | Fiscal policy and exchange rates |
| Authors: | Annicchiarico, Barbara |
| Keywords: | exchange rates
fiscal deficits
current account dynamics |
| Issue Date: | Oct-2002 |
| Publisher: | CEIS |
| Series/Report no.: | Quaderni CEIS; 174 |
| Abstract: | This paper examines the dynamics of the nominal exchange rate and fiscal deficits in a continuous time optimising general equilibrium model with finite horizon.
It is shown that alternative financing modes of budget deficits imply different patterns of adjustment along the transitional path towards the steady state equilibrium. Fiscal policy may provide the nominal anchor for the exchange rate and the respect of public solvency without money financing is not sufficient to avoid the depreciation of the exchange rate in the long-run after a fiscal expansion. |
| URI: | http://hdl.handle.net/2108/270 |
| Appears in Collections: | Quaderni
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| 174.pdf | | 260Kb | Adobe PDF | View/Open |
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