TY  - JOUR
CY  - Amsterdam
ID  - publications48533
UR  - http://tse-fr.eu/pub/128956
A1  - Berriel, Rafael
A1  - Gonzalez-Aguado, Eugenia
A1  - Kehoe, P.
A1  - Pastorino, Elena
Y1  - 2024/01//
N2  - When is a fiscal union appropriate for a monetary union? In a monetary union without fiscal externalities, when local fiscal authorities have an informational advantage over a central fiscal authority in terms of their knowledge of countries’ preferences for government spending, a decentralized fiscal regime dominates a centralized one. Our novel result is that in the presence of fiscal externalities across countries, however, a decentralized fiscal regime is optimal for small monetary unions, whereas a centralized fiscal regime is optimal for large ones. These results shed new light on the debate on fiscal integration within the EU and its enlargement.
PB  - Elsevier
JF  - Journal of Monetary Economics
VL  - vol. 141
SN  - 0304-3932
TI  - Is a fiscal union optimal for a monetary union?
SP  - 157
AV  - none
EP  - 177
ER  -