Cross-border spill-overs from fiscal stimulus in a monetary union

2017 ◽  
Vol 65 ◽  
pp. 95-105 ◽  
Author(s):  
Ruthira Naraidoo ◽  
Eric Schaling ◽  
Mewael F. Tesfaselassie
Keyword(s):  
Monetary Union ◽  
Fiscal Stimulus ◽  
Cross Border

A Decade After the 2009 Global Recession: Macroeconomic Developments

2021 ◽  
pp. 2150011
Author(s):  
Wee Chian Koh ◽  
Shu Yu
Keyword(s):  
Low Income ◽  
Developing Economies ◽  
Emerging Market ◽  
Bank Lending ◽  
Low Income Countries ◽  
Short Term ◽  
Fiscal Stimulus ◽  
Cross Border ◽  
Global Recession ◽  
The Impact

Emerging market and developing economies (EMDEs) weathered the 2009 global recession relatively well. However, the impact of the global recession varied across economies. EMDEs with stronger pre-crisis fundamentals — such as large foreign exchange reserves, sound fiscal positions, and low inflation — suffered milder growth slowdowns, in part due to their greater capacity to engage in monetary and fiscal stimulus. Low-income countries were also resilient, as foreign aid and inflows of remittances remained relatively stable. In contrast, EMDEs that were heavily dependent on short-term capital flows — such as portfolio investment and cross-border bank lending — fared less well, especially those in Europe and Central Asia. A key lesson for EMDEs is the need to strengthen macroeconomic frameworks and create policy space to prepare for future global downturns.

scholarly journals Fiscal Stimulus in a Monetary Union: Evidence from US Regions

2014 ◽  
Vol 104 (3) ◽  
pp. 753-792 ◽  
Author(s):  
Emi Nakamura ◽  
Jón Steinsson
Keyword(s):  
Monetary Union ◽  
Open Economy ◽  
Government Spending ◽  
Tax Policy ◽  
Regional Variation ◽  
Historical Data ◽  
Closed Economy ◽  
Fiscal Stimulus ◽  
Highly Sensitive ◽  
Military Procurement

We use rich historical data on military procurement to estimate the effects of government spending. We exploit regional variation in military buildups to estimate an “open economy relative multiplier” of approximately 1.5. We develop a framework for interpreting this estimate and relating it to estimates of the standard closed economy aggregate multiplier. The latter is highly sensitive to how strongly aggregate monetary and tax policy “leans against the wind.” Our open economy relative multiplier “differences out” these effects because monetary and tax policies are uniform across the nation. Our evidence indicates that demand shocks can have large effects on output. (JEL E12, E32, E62, F33, H56, H57, R12)

I. Company Law and Trade in Securities

1997 ◽  
Vol 46 (1) ◽  
pp. 202-205
Author(s):  
Takis Tridimas
Keyword(s):  
European Union ◽  
Monetary Union ◽  
Financial Services ◽  
Company Law ◽  
Economic And Monetary Union ◽  
The European Union ◽  
Prudential Supervision ◽  
Securities Law ◽  
Cross Border ◽  
Legislative Activity

In the last two years there has been significant legislative activity in the field of company law. The most important development in the field of securities law has been the adoption of a directive amending, inter alia, the Investment Services Directive1 and the directive on undertakings for collective investments in transferable securities2, with a view to reinforcing prudential supervision3. A number of initiatives have been taken with a view to preparing for economic and monetary union. In particular, the Commission has submitted a proposal for a directive on cross-border credit transfers within the European Union which, if adopted, will increase efficiency of cross-border payments4. The regulation of trade in financial services between the Community and third States is of increasing importance, following the conclusion of the General Agreement on Trade in Services5.

scholarly journals Macroprudential Policy in a Monetary Union with Cross-Border Banking

2019 ◽  
Author(s):  
Matthieu Darracq Paries ◽  
Christoffer Kok ◽  
Elena Rancoita
Keyword(s):  
Monetary Union ◽  
Macroprudential Policy ◽  
Cross Border

scholarly journals CROSS-BORDER BANKING AND MACROPRUDENTIAL POLICIES IN ASYMMETRIC MONETARY UNIONS

2018 ◽  
Vol 24 (2) ◽  
pp. 255-290
Author(s):  
Lena Dräger ◽  
Christian R. Proaño
Keyword(s):  
Monetary Union ◽  
Banking Sector ◽  
Macroeconomic Performance ◽  
Monetary Unions ◽  
Leverage Ratio ◽  
Macroeconomic Volatility ◽  
Cross Border ◽  
Macroprudential Policies ◽  
Macroeconomic Imbalances ◽  
Lending Standards

Against the background of the emergence of macroeconomic imbalances within the European Monetary Union (EMU), we investigate in this paper the macroeconomic consequences of cross-border banking in monetary unions such as the Euro area. For this purpose, we incorporate a union-wide banking sector along the lines in an otherwise standard two-region monetary union DSGE model, accounting for borrowing constraints of entrepreneurs and impatient households and an internal constraint on the bank's leverage ratio. We illustrate in particular how rule-of-thumb lending standards based on the macroeconomic performance of the core region within the monetary union can translate into destabilizing spill-over effects into the other region, resulting in an overall higher macroeconomic volatility. Thereby, we demonstrate a channel through which the financial sector may have exacerbated the emergence of macroeconomic imbalances within the EMU. This effect may be mitigated by macroprudential policies, where especially policies that force the bank's lending standards to be less procyclical prove to be effective in stabilizing output in both regions of the monetary union.

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