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  • Open Daily: 10am - 10pm
    Alley-side Pickup: 10am - 7pm

    3038 Hennepin Ave Minneapolis, MN
    612-822-4611

Open Daily: 10am - 10pm | Alley-side Pickup: 10am - 7pm
3038 Hennepin Ave Minneapolis, MN
612-822-4611
Fiscal Federalism in the EMU

Fiscal Federalism in the EMU

Koenigs, Claus

Paperback

Economics

Currently unavailable to order

ISBN10: 3844318690
ISBN13: 9783844318692
Publisher: Lap Lambert Academic Pub
Published: Mar 14 2011
Pages: 72
Weight: 0.26
Height: 0.17 Width: 6.00 Depth: 9.00
Language: English
With the creation of the EMU, member countries have abandoned their monetary policy sovereignty for the benefits of the Euro. Previously, output fluctuations between countries could automatically be absorbed by an adjustment of the relative exchange rate between the national economies. It is frequently argued that the loss of this channel must be compensated by an appropriate fiscal policy tool to avoid large and protracted regional swings in economic growth and unemployment. A fiscal federation could serve as a centralized insurance mechanism against idiosyncratic, transitory shocks among the member states. The paper establishes a framework for an interregional insurance mechanism and applies the methodology to a sample of EMU countries. The empirical results reveal the potential magnitude of insurance provided by a redistributive mechanism and allow conclusions as to whether a fiscal federation should be established in the EMU.

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