Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/100120
Authors: 
Cuadra, Gabriel
Ramos-Francia, Manuel
Year of Publication: 
2014
Series/Report no.: 
Working Papers, Banco de México 2014-10
Abstract: 
There is an ongoing debate about austerity and stimulus in the Euro zone. Moreover, given the fiscal and financial problems in the region, a default has appeared likely at times. In this context, this paper develops a dynamic stochastic quantitative model of sovereign default with fiscal policy, which captures the most salient features of the recent fiscal and debt situation in the Euro zone. In this setting, this highlights the economic nature of the decision to default, the key role of official aid in avoiding such event and, thus, improving the overall economic outlook.
Subjects: 
Sovereign Default
Fiscal Policy
JEL: 
E62
F34
Document Type: 
Working Paper
Appears in Collections:

Files in This Item:
File
Size
599.03 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.