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Is Real Depreciation And More Government Spending Expansionary? The Case Of Montenegro

Author

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  • YU HSING

    (Joseph H. Miller Endowed Professor in Business, Department of Management & Business Administration, College of Business, Southeastern Louisiana University, Hammond, LA, USA)

Abstract

Employing an extended IS-MP-AS model to study the effects of the exchange rate, fiscal policy and other related variables in Montenegro, the paper finds that real depreciation of the Euro, a lower government spending-to-GDP ratio, a lower real lending rate in the Euro area, a lower lagged real oil price, a higher lagged real GDP in Germany, and a lower expected inflation rate would promote economic growth. Classification-JEL: E62, F41

Suggested Citation

  • Yu Hsing, 2017. "Is Real Depreciation And More Government Spending Expansionary? The Case Of Montenegro," Review of Economic and Business Studies, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, issue 20, pages 103-113, December.
    • Handle: RePEc:aic:revebs:y:2017:j:20:hsingy
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    References listed on IDEAS

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    More about this item

    Keywords

    Currency depreciation; government spending; interest rates; IS-MP-AS model.;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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