Euro membership and fiscal reaction functions : [Version 10 May 2013]
- The paper uses fiscal reaction functions for a panel of euro-area countries to investigate whether euro membership has reduced the responsiveness of countries to shocks in the level of inherited debt compared to the period prior to succession to the euro. While we find some evidence for such a loss in prudence, the results are not robust to changes in the specification, such as an exclusion of Greece from the panel. This suggests that the current debt problems may result to a large extent from preexisting debt levels prior to entry or from a larger need for fiscal prudence in a common currency, while an adverse change in the fiscal reaction functions for most countries does not apply.
| Author: | Alfons J. WeichenriederORCiDGND, Jochen Zimmer |
|---|---|
| URN: | urn:nbn:de:hebis:30:3-305718 |
| URL: | http://ssrn.com/abstract=2265312 |
| DOI: | https://doi.org/10.2139/ssrn.2265312 |
| Parent Title (German): | SAFE working paper series ; No. 18 |
| Series (Serial Number): | SAFE working paper (18) |
| Place of publication: | Frankfurt am Main |
| Document Type: | Working Paper |
| Language: | English |
| Year of Completion: | 2013 |
| Year of first Publication: | 2013 |
| Publishing Institution: | Universitätsbibliothek Johann Christian Senckenberg |
| Release Date: | 2013/06/27 |
| Tag: | debt sustainability; euro area; fiscal reaction function |
| Issue: | Version 10 May 2013 |
| Page Number: | 29 |
| HeBIS-PPN: | 348829981 |
| Institutes: | Wirtschaftswissenschaften / Wirtschaftswissenschaften |
| Wissenschaftliche Zentren und koordinierte Programme / House of Finance (HoF) | |
| Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS) | |
| Dewey Decimal Classification: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
| Sammlungen: | Universitätspublikationen |
| Licence (German): |  Deutsches Urheberrecht |
