Fiscal devaluation and real exchange rates in the Euro area: Some econometric insights (CROSBI ID 263498)
Prilog u časopisu | izvorni znanstveni rad | međunarodna recenzija
Podaci o odgovornosti
Tkalec, Marina ; Vizek, Maruška ; Vukšić, Goran
engleski
Fiscal devaluation and real exchange rates in the Euro area: Some econometric insights
We explore whether a fiscal devaluation, that is, a reduction in employers’ social security contributions and an increase in value added tax, affects two indicators of bilateral real exchange rates in the euro area: one based on unit labor costs, and another based on consumer prices. We find that, in the short term, cuts in employers’ contributions depreciate real exchange rates based on unit labor costs, while value added tax hikes appreciate real exchange rates based on consumer prices. In the long run, a value added tax increase also appreciates the real exchange rates based on unit labor costs.
taxation ; real exchange rates ; fiscal devaluation ; euro area
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Podaci o izdanju
27 (2)
2019.
694-710
objavljeno
0965-7576
1467-9396
10.1111/roie.12393