| Publication type: | Article in scientific journal |
| Type of review: | Peer review (publication) |
| Title: | Economic openness and fiscal multipliers |
| Authors: | Riguzzi, Marco Wegmüller, Philipp |
| DOI: | 10.1080/10168737.2016.1204337 |
| Published in: | International Economic Journal |
| Volume(Issue): | 31 |
| Issue: | 1 |
| Page(s): | 1 |
| Pages to: | 35 |
| Issue Date: | 2017 |
| Publisher / Ed. Institution: | Routledge |
| ISSN: | 1016-8737 1743-517X |
| Language: | English |
| Subjects: | Exchange rate flexibility; Openness to trade; Capital mobility; Fiscal multiplier |
| Subject (DDC): | 330: Economics |
| Abstract: | Recent empirical findings attribute a central role to the degree of economic openness to determine the size of the fiscal multiplier. See, for instance, Ilzetzki et al. (2013) [How big (small?) are fiscal multipliers? Journal of Monetary Economics, 60(2), 239–254]. However, traditional macroeconomic models have difficulties to account for this evidence. By introducing ‘deep-habit’ formation into a New Keynesian small open economy model, this paper provides a theoretical framework which is able to attest for the new empirical evidence. Deep habits give rise to counter-cyclical firm markups, which are crucial to generate effects of openness on the fiscal multiplier as found in the data. We study three dimensions of economic openness: exchange rate flexibility, trade openness, and capital mobility. In line with the empirical findings, we report a negative relationship between measures of economic openness and the fiscal multiplier. |
| URI: | https://digitalcollection.zhaw.ch/handle/11475/8986 |
| Fulltext version: | Published version |
| License (according to publishing contract): | Licence according to publishing contract |
| Departement: | School of Management and Law |
| Organisational Unit: | Winterthur Institute of Health Economics (WIG) |
| Appears in collections: | Publikationen School of Management and Law |
Files in This Item:
There are no files associated with this item.
Show full item record
Riguzzi, M., & Wegmüller, P. (2017). Economic openness and fiscal multipliers. International Economic Journal, 31(1), 1–35. https://doi.org/10.1080/10168737.2016.1204337
Riguzzi, M. and Wegmüller, P. (2017) ‘Economic openness and fiscal multipliers’, International Economic Journal, 31(1), pp. 1–35. Available at: https://doi.org/10.1080/10168737.2016.1204337.
M. Riguzzi and P. Wegmüller, “Economic openness and fiscal multipliers,” International Economic Journal, vol. 31, no. 1, pp. 1–35, 2017, doi: 10.1080/10168737.2016.1204337.
RIGUZZI, Marco und Philipp WEGMÜLLER, 2017. Economic openness and fiscal multipliers. International Economic Journal. 2017. Bd. 31, Nr. 1, S. 1–35. DOI 10.1080/10168737.2016.1204337
Riguzzi, Marco, and Philipp Wegmüller. 2017. “Economic Openness and Fiscal Multipliers.” International Economic Journal 31 (1): 1–35. https://doi.org/10.1080/10168737.2016.1204337.
Riguzzi, Marco, and Philipp Wegmüller. “Economic Openness and Fiscal Multipliers.” International Economic Journal, vol. 31, no. 1, 2017, pp. 1–35, https://doi.org/10.1080/10168737.2016.1204337.
Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.