3978
Views
518
Downloads |
Interactions between fiscal and monetary policies: a brief history of a long relationship*
Dubravko Mihaljek* 
Article | Year: 2021 | Pages: 419 - 432 | Volume: 45 | Issue: 4 Received: October 15, 2021 | Accepted: October 31, 2021 | Published online: September 6, 2021
|
FULL ARTICLE
FIGURES & DATA
REFERENCES
CROSSMARK POLICY
METRICS
LICENCING
PDF
1 Including health and non-health related spending measures announced through March 2021, based on IMF’s Fiscal Policies Database. For the European Recovery and Resilience Facility, 50% of grants assumed to be spent in 2021. Sources: European Commission; IMF, Fiscal Policies Database; OECD; author’s calculations.
1 Total as![]() sets; median values for eight advanced economies (AEs) and 22 emerging market economies (EMEs). EMEA = emerging Europe, Middle East and Africa. Sources: IMF; national data; BIS, Database on monetary policy announcements during Covid-19; Cantu et al. (2021).
|
|
General government deficit
|
Gross public debt
|
|
|
2019
|
2020
|
2021
|
2019
|
2020
|
2021
|
|
Euro
area
|
–0.6
|
–7.6
|
–6.7
|
84
|
97
|
98
|
|
France
|
–3.0
|
–9.9
|
–7.2
|
98
|
114
|
115
|
|
Germany
|
1.5
|
–4.2
|
–5.5
|
60
|
69
|
70
|
|
Spain
|
–2.9
|
–11.5
|
–9.0
|
96
|
117
|
118
|
|
Italy
|
–1.6
|
–9.5
|
–8.8
|
135
|
156
|
157
|
|
Japan
|
–3.1
|
–12.6
|
–9.4
|
235
|
256
|
257
|
|
United
Kingdom
|
–2.3
|
–13.4
|
–11.8
|
85
|
104
|
107
|
|
United
States
|
–5.7
|
–15.8
|
–15.0
|
108
|
127
|
133
|
|
Brazil
|
–5.9
|
–13.4
|
–8.3
|
88
|
99
|
98
|
|
China
|
–6.3
|
–11.4
|
–9.6
|
57
|
67
|
70
|
|
India
|
–7.4
|
–12.3
|
–10.0
|
74
|
90
|
87
|
|
South
Korea
|
0.4
|
–3.1
|
–2.7
|
42
|
48
|
53
|
|
Mexico
|
–2.3
|
–4.6
|
–3.4
|
53
|
61
|
61
|
|
Russia
|
1.9
|
–4.1
|
–0.8
|
14
|
19
|
18
|
|
Turkey
|
–6.4
|
–7.4
|
–7.1
|
32
|
40
|
40
|
|
South
Africa
|
–5.3
|
–12.2
|
–10.6
|
62
|
77
|
81
|
Amendola, A. [et al.], 2019. The euro-area government spending multiplier at the effective lower bound. IMF Working Paper, No 19/133 [ CrossRef]
Bernanke, B., 2013. Statement before the Committee on Financial Services. US House of Representatives, 17 July.
Blanchard, O., 2004. Fiscal dominance and inflation targeting: lessons from Brazil. NBER Working Paper, No 10389 [ CrossRef]
Blommestein, H. and Turner, P., 2012. Interactions between sovereign debt management and monetary policy under fiscal dominance and financial instability. BIS Papers, No 65, pp. 313-338.
Cochrane, J. H., 2021. r<g. Hoover Institution, Stanford University, July.
Draghi, M., 2014. Unemployment in the euro area. Speech at the Annual central bank symposium in Jackson Hole, 22 August.
Gilchrist, S. [et al.], 2020. The Fed takes on corporate credit risk: an analysis of the efficacy of SMCCF. NBER working paper, No 27809 [ CrossRef]
Goodhart, C., 2016. Whither central banking? In: Central banking in times of change. Vienna: Oesterreichische Nationalbank., pp 29-31.
Hazell, J. [et al.], 2020. The slope of the Phillip curve: evidence from US states. NBER Working Paper, No 28005 [ CrossRef]
Karger, E. and Rajan, R., 2020. Heterogeneity in the marginal propensity to consume: evidence from Covid-19 stimulus payments. Federal Reserve Bank of Chicago Working Paper, No 2020–15 [ CrossRef]
Klein, M. and Winkler, R., 2021. The government spending multiplier at the zero lower bound: international evidence from historical data. Journal of Applied Econometrics, 36(6), pp 744–59 [ CrossRef]
Krishnamurthy, A. and Vissing-Jorgensen, V., 2013. The ins and outs of LSAPs. In: Global dimensions of unconventional monetary policy, Economic Policy Symposium, Jackson Hole, August.
Laeven, L. and Valencia, F., 2018. Systemic banking crises revisited. IMF Working Paper, No 18/206 [ CrossRef]
Lian, W., Presbitero, A. and Wiriadinata, U., 2020. Public debt and r–g at risk. IMF Working Paper, WP/20/137 [ CrossRef]
Mankiw, G. and Taylor, M., 2011. Economics. Cengage Learning EMEA.
Monnet, E., 2012. Financing a Planned economy: institutions and credit allocation in the French golden age of growth, 1954–1974 . Berkeley Economic History Laboratory Working Paper, September [ CrossRef]
Rajan, R., 2013. A step in the dark: unconventional monetary policy after the crisis. Andrew Crockett Memorial Lecture, BIS, 23 June.
Sargent, T. and Wallace, N., 1981. Some unpleasant monetarist arithmetic. Federal Reserve Bank of Minneapolis Quarterly Review, Fall [ CrossRef]
Schwartz, G. [et al.] eds, 2020. Well spent: how strong infrastructure governance can end waste in public investment. Washington: International Monetary Fund [ CrossRef]
Stein, J., 2013. Overheating in credit markets: origins, measurement, and policy responses. Speech at a Federal Reserve Bank of St. Louis Research Symposium, 7 February.
Weidmann, J., 2020. Too close for comfort? The relationship between monetary and fiscal policy. Speech at the OMFIF Virtual Panel, 5 November.
|
|
December, 2021
IV/2021 |
