IDEAS home Printed from https://ideas.repec.org/a/eee/ecosys/v48y2024i4s0939362524000384.html
   My bibliography  Save this article

The impact of the heterogenous fiscal policy stance of euro-area member states on ECB monetary policy

Author

Listed:
  • Jurkšas, Linas

Abstract

This article assesses the influence of the fiscal stance of different euro-area members on the monetary policy actions of the European Central Bank. This issue has increased in relevance due to the widening disparities in the levels of debt across euro-area member states. We utilise a thick modelling approach that includes various GMM model specifications for the five largest euro area economies using quarterly projections data from 2002 to 2022. The findings indicate that the fiscal deficits of different euro area countries did not consistently exert a substantial impact on monetary policymaking. This conclusion holds even after the COVID-19 shock, with projected inflation remaining the most consistently significant indicator.

Suggested Citation

  • Jurkšas, Linas, 2024. "The impact of the heterogenous fiscal policy stance of euro-area member states on ECB monetary policy," Economic Systems, Elsevier, vol. 48(4).
    • Handle: RePEc:eee:ecosys:v:48:y:2024:i:4:s0939362524000384
    DOI: 10.1016/j.ecosys.2024.101216
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0939362524000384
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ecosys.2024.101216?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Euro area; Monetary policy; Taylor-rule; Fiscal policy; Heterogeneities;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecosys:v:48:y:2024:i:4:s0939362524000384. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://edirc.repec.org/data/osteide.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.