Using an estimated DSGE model that features monetary and fiscal policy interactions and allows for equilibrium indeterminacy, we find that a passive monetary and passive fiscal policy regime prevailed in the pre-Volcker period while an active monetary and passive fiscal policy regime prevailed post-Volcker. Since both monetary and fiscal policies were passive pre-Volcker, there was equilibrium ...

The countercyclical monetary policy is a policy that economists recommend to adopt in order to slow down the economic fluctuations. The aim of this study is to address the question that, in the presence of fiscal dominance and considering institutional quality (IQL), what the optimal monetary policy should be during the business cycles? To find the appropriate answer, first, in the framework of...

This study assesses the asymmetric effectiveness of Turkey's monetary policy and fiscal under inflation targeting regime in period 2006-2020. We employed non-linear autoregressive distributed lag (NARDL) method Hatemi-J causality test with assistance St. Louis equation, which relates growth nominal income money supply public expenditures. The NARDL model revealed that an increase gross domestic...

This study aims to answer the question: What is nature of relationship between fiscal and monetary policy in Jordan? Are two policies complementary each other, alternatives, or go opposite directions?. applies vector autoregression VAR, Impulse Response Function test, Granger Causality the. Variance Decomposition Analysis. The results showed that there a bidirectional causal government expendit...

Our paper examines the impacts of monetary and fiscal policies on Borsa Istanbul (BIST) performance in Turkey. In established model, government expenditures, tax revenue, budget deficit, money supply (M2), interest rate, gdp growth rate included as independent variables BIST stock market capitalisation dependent variable for last 25 years (1995 to 2020). Firstly, Augmented Dickey - Fuller (ADF)...

We use a dynamic game model of a two-country monetary union to study the impacts of an exogenous fall in aggregate demand, the resulting increase in public debt, and the consequences of a sovereign debt haircut for a member country or bloc of the union. In this union, the governments of participating countries pursue national goals when deciding on fiscal policies, whereas the common central ba...