Fiscal Stimulus Packages and Uncertainty in Times of Crisis – The Option of Waiting Can Be Valuable, Though!

Arbeitspapier

Policymakers in the EU member states are currently shaping rescue packages to prevent the financial crisis hitting their economies with unmitigated force. Each government is responding to the emerging problems with a country-specific set of measures. Given the global nature of the crisis, would coordinated action at the European level not be a better approach? Was the German government - much-criticized for its initial reluctance to adopt massive fiscal stimulation measures - right after all to exploit the option value of waiting in a situation of high uncertainty? The answer to the second question is a qualified yes. However, the answer to the first one is more complex and crucially depends on how reasonable it appears to model the impact of the economic crisis as an exogenous demand shock which has hit the euro area countries.

Object Details

• ISBN: 978-3-86788-099-2
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Ruhr Economic Papers ; No. 88

Classification and Topics

• Classification: Wirtschaft ; Fiscal Policy ; International Policy Coordination and Transmission ; National Deficit; Surplus
• Subject: Policy co-ordination ; fiscal multiplier ; fiscal stimulus package ; liquidity constraint ; option value of waiting ; uncertainty ; Finanzmarktkrise ; Internationaler Finanzmarkt ; Antizyklische Finanzpolitik ; Internationale wirtschaftspolitische Koordination ; Dauer ; Entscheidung bei Unsicherheit ; Realoption ; Wirtschaftspolitische Wirkungsanalyse ; EU-Staaten

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Belke, Ansgar
• Event: Veröffentlichung
• (who): Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI)
• (where): Essen
• (when): 2009

Further information

• Handle: http://hdl.handle.net/10419/26853
• Last update: 10.03.2025, 11:41 AM CET