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Long-run Effects of Fiscal Policy and Domestic Public Debt on the Real Levels of Exchange Rate and GDP

In: The Role of Private Financial Wealth in a Portfolio Model

Author

Listed:
  • Angel Calderón-Madrid

    (El Colegio de Mexico)

Abstract

Some of the propositions deduced from open economy models in the Mundell–Fleming tradition have been subject to reformulations because of the implications that follow from changes in the level of foreign assets occurring as a consequence of the cumulative sum of current account imbalances induced by fiscal actions. Among these amendments are the ones investigated in this chapter, namely those relating to propositions about the effects of fiscal policy on the real levels of GDP and exchange rate, when perfect capital mobility prevails.

Suggested Citation

  • Angel Calderón-Madrid, 1995. "Long-run Effects of Fiscal Policy and Domestic Public Debt on the Real Levels of Exchange Rate and GDP," Palgrave Macmillan Books, in: The Role of Private Financial Wealth in a Portfolio Model, chapter 1, pages 1-30, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-37554-3_1
    DOI: 10.1057/9780230375543_1
    as

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