Fiscal Policy and Interest Rates in the European Union
This volume aims to provide a comprehensive study concerned with the potential effects of fiscal policy on financial markets in the European Union. It takes into account the gradual liberalization of capital movements throughout Western Europe and the institutional framework of the European Monetary System. The author looks at the impact of budget deficits on interest rates, especially in relation to international financial integration and concludes that the increases in European budget deficits since the 1970s have raised interest rates in the long term throughout the Union. He argues that balanced budget deficits are necessary to maintain low interest rates.
What people are saying - Write a review
We haven't found any reviews in the usual places.
Fundamental determinants of interest rate differentials
Theory determinants and measurement
11 other sections not shown
Other editions - View all
after-tax expected real aggregate analysis band Belgium BF/FN BU/MB Chapter coefficient correlation countries credibility current account deficits and interest depreciation Deutschemark devaluation expectations devaluation risk DiP 0 DiP DiP DiP DiP Dutch economic effect empirical equation estimated European Monetary System European Union expected inflation expected rate expected real interest financial markets fiscal policy fundamentals government budget deficits government debt government deficit government spending Granger-causality idem impact interest differentials interest rate differentials investment Italy long-run restrictions short-run long-term interest rates LR-statistic p-value LR-statistic measure money growth money supply multicollinearity national saving Netherlands nominal interest rates OECD oil prices p-value LR-statistic p-value positive ratio rational expectations real interest rates realignment regression restrictions short-run restrictions Ricardian equivalence Roubini and Sachs short-run restrictions Hypothesis short-term interest rates significant stabilisation stabilisation policies Svensson Table target zone term structure unadjusted variables various vector autoregressive zero