TY  - JOUR
AU  - Feldstein,Martin
TI  - U.S. Budget Deficits and the European Economies:  Resolving the Political Economy Puzzle
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 1790
PY  - 1986
Y2  - December 1986
UR  - http://www.nber.org/papers/w1790
L1  - http://www.nber.org/papers/w1790.pdf
N1  - Author contact info:
Martin S. Feldstein
President Emeritus
NBER
1050 Massachusetts Avenue
Cambridge, MA  02138-5398
Tel: 617/868-3905
Fax: 617/868-7194
E-Mail: msfeldst@nber.org
AB  - This paper, prepared for the annual meetings of the American Economic Association, discusses how the increases in the U.S. budget deficits since 1980 have affected the economies of Western Europe. The analysis emphasizes that U.S. deficits have not only affected these economies directly but have also induced them to adopt more restrictive monetary and fiscal policies than they would otherwise have chosen. This induced shift in domestic policies is the primary reason why European governments have pressed for a reduction in the U.S. budget deficits despite the favorable impact of those deficits on European trade surpluses.
ER  -