Abstract
1) The static model. As a point of reference, consider the static model. It can be represented by a system of two equations:
Of course this is a reduced form. Y1 denotes German output, Y2 is French output, M is European money supply, G1 is German government purchases, G2 is French government purchases, A1 is some other factors bearing on German output, A2 is some other factors bearing on French output, α is the monetary policy multiplier, and β is the fiscal policy multiplier. The endogenous variables are German output and French output.
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© 2007 Springer-Verlag Berlin Heidelberg
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(2007). Competition between European Central Bank, German Government, and French Government. In: Macroeconomics of Monetary Union. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-73633-2_4
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DOI: https://doi.org/10.1007/978-3-540-73633-2_4
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-540-73632-5
Online ISBN: 978-3-540-73633-2
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