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- W4285607883 abstract "Fiscal devaluations—an increase in import tariffs and export subsidies (IX) or an increase in value-added taxes and payroll subsidies (VP)—have been shown to provide as much stimulus under fixed exchange rates as a currency devaluation. We find that if agents expect policies to be reversed and the tax pass-through is large, VP is contractionary and IX provides a modest boost. In our medium-scale DSGE model, both features are crucial in accounting for Germany’s underperformance in response to VP in 2007. These findings cast doubt on fiscal devaluations as a cyclical stabilization tool when monetary policy is constrained." @default.
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- W4285607883 date "2022-06-01" @default.
- W4285607883 modified "2023-10-05" @default.
- W4285607883 title "Trade policies and fiscal devaluations" @default.
- W4285607883 doi "https://doi.org/10.17016/ifdp.2022.1347" @default.
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