Arbeitspapier
Fiscal divergence and current account imbalances in Europe
Since the breakdown of the Bretton Woods System diverging current account positions in Europe have prevailed. While the Southern and Western European countries have tended to run current account deficits, the current accounts of the Central and Northern European countries, in particular Germany, have tended to be in surplus. The paper scrutinizes the role of diverging fiscal policy stances for current account imbalances in Europe since the early 1970s under alternative institutional monetary arrangements (floating exchange rates, European Monetary System, and European Monetary Union). It sheds light on the interaction of fiscal and monetary policies with respect to their impact on the current account and analyses the role of exchange rate changes and credit facilities as adjustment mechanisms for current account imbalances. Panel regressions reveal a robust impact of fiscal policy divergence on current account imbalances, which to a large extent is independent from the exchange rate regime, but which turns out to be contingent on the monetary policy stance.
- Language
-
Englisch
- Bibliographic citation
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Series: CESifo Working Paper ; No. 4108
- Classification
-
Wirtschaft
Current Account Adjustment; Short-term Capital Movements
International Monetary Arrangements and Institutions
International Policy Coordination and Transmission
National Deficit; Surplus
- Subject
-
Europe
EMU
EMS
current account imbalances
exchange rate adjustment
credit mechanisms
European debt crisis
Leistungsbilanz
Zahlungsbilanzungleichgewicht
Finanzpolitik
Geldpolitik
Europäischer Währungsverbund
Europäische Wirtschafts- und Währungsunion
Internationaler Kredit
EU-Staaten
Öffentliche Schulden
Eurozone
- Event
-
Geistige Schöpfung
- (who)
-
Schnabl, Gunther
Wollmershäuser, Timo
- Event
-
Veröffentlichung
- (who)
-
Center for Economic Studies and ifo Institute (CESifo)
- (where)
-
Munich
- (when)
-
2013
- Handle
- Last update
-
10.03.2025, 11:43 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Schnabl, Gunther
- Wollmershäuser, Timo
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2013
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