NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Bartosz Maćkowiak

Sonnemannstrasse 22
60314 Frankfurt am Main
Europe
Tel: +49 69 1344 5364
Fax: +49 69 1344 935364

E-Mail: bartosz.mackowiak@ecb.int
Institutional Affiliation: European Central Bank

NBER Working Papers and Publications

August 2017Monetary-Fiscal Interactions and the Euro Area's Malaise
with Marek Jarociński: w23746
When monetary and fiscal policy are conducted as in the euro area, output, inflation, and government bond default premia are indeterminate according to a standard general equilibrium model with sticky prices extended to include defaultable public debt. With sunspots, the model mimics the recent euro area data. We specify an alternative configuration of monetary and fiscal policy, with a non-defaultable eurobond. If this policy arrangement had been in place since the onset of the Great Recession, output could have been much higher than in the data with inflation in line with the ECB's objective.

Published: Marek Jarociński & Bartosz Maćkowiak, 2017. "Monetary-Fiscal Interactions and the Euro Area’s Malaise," Journal of International Economics, . citation courtesy of

June 2017Monetary-Fiscal Interactions and the Euro Area’s Malaise
with Marek Jarocinski
in NBER International Seminar on Macroeconomics 2017, Jeffrey Frankel, Hélène Rey, and Charles Engel, organizers
 
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