Financial heterogeneity and monetary union

• 成果类型: Article
• 署名作者: Gilchrist, Simon; Schoenle, Raphael; Sim, Jae; Zakrajsek, Egon
• 署名单位: New York University; National Bureau of Economic Research; Brandeis University; Federal Reserve System - USA; Bank for International Settlements (BIS)
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2023.06.002
• 发表日期: 2023
• 页码: 21-40
• 关键词: Eurozone; Financial crisis; monetary union; inflation; markups; Customer markets; Fiscal devaluation

摘要

During the 2010-12 eurozone crisis, deviations of price and wage dynamics from those implied by canonical Phillips curves were systematically related to differences in financial strains across countries. Most notably, markups in financially weak (periphery) countries rose, while those in financially strong (core) countries declined. In a monetary union model, where financial frictions interact with the firms' pricing decisions because of customer-market considerations, firms in the periphery maintain cashflows in response to an adverse financial shock by raising markups in both domestic and export markets, while firms in the core reduce markups, undercutting their financially constrained competitors to gain market share. In this framework, a unilateral fiscal-devaluation-style policy by the periphery stabilizes the local economy by improving the condition of firm balance sheets and by boosting household demand-it does not, however, reverse the real exchange rate appreciation in the periphery.(c) 2023 Elsevier B.V. All rights reserved.