2026-06-07T16:08:56Zhttps://docta.ucm.es/rest/oai/requestoai:docta.ucm.es:20.500.14352/132262023-08-26T19:49:19Zcom_20.500.14352_14col_20.500.14352_15
Docta Complutense
author
Jalles, Joao Tovar
author
Mulas Granados, Carlos
author
Tavares, José
author
Correa Caro, Carolina
2023-06-17T13:21:33Z
2023-06-17T13:21:33Z
2018-03
1350-4851
10.1080/13504851.2017.1327119
https://hdl.handle.net/20.500.14352/13226
https://doi.org/10.1080/13504851.2017.1327119
We examine how exchange rate regimes affect fiscal discipline by investigating European countries as they transitioned from flexible to fully fixed exchange rates under the Euro. We apply the synthetic control method to estimate, for each Eurozone country, its counterfactual budget stance under flexible rates. Our evidence strongly suggests that fixing exchange rates negatively impacted negatively fiscal discipline. However, effects were not homogeneous, as they were mediated by political factors. For example, countries where policymakers faced a longer political horizon and operated within a more cohesive political environment, managed to perform better in terms of fiscal discipline.
eng
Single currency and fiscal performance: the early Euro Area in perspective
journal article
URL
https://docta.ucm.es/bitstreams/08944b46-9454-4a2c-be9b-00ec8c665653/download
File
MD5
487b0ec314a1d40fdab52a56eff0f760
829974
application/pdf
Jalles-Single currency.pdf