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V. Chari, P. Kehoe and E. McGrattan, “Are Structural VaRs with Long-Run Restrictions Useful in Developing Business Cycle Theory,” Journal of Monetary Economics, Vol. 55, No. 8, 2008, pp. 1337-1352. doi:10.1016/j.jmoneco.2008.09.010

has been cited by the following article:

• TITLE: Discretionary Fiscal Policy and the European Monetary Union

  AUTHORS: Jason Jones

  KEYWORDS: Fiscal Policy; Policy Interaction; EMU

  JOURNAL NAME: Modern Economy, Vol.3 No.6, October 31, 2012

  ABSTRACT: A model of circumstances that can lead to changes in the way a fiscal authority conducts policy after joining a monetary union is presented and empirically tested for the euro area. According to the model consolidation fatigue, shock asymmetry, or differences in the relative weight placed on output/price stabilization between the new and old monetary authority can lead to greater reliance on fiscal policy. Empirical evidence suggests that there has been a change in the conduct of fiscal policy in the euro area which is most likely due to consolidation fatigue and a stronger emphasis on price stabilization by the European Central Bank.