Abstract
The relationship between fiscal and financial euro area indicators and sovereign yield spreads has changed after the start of the financial crisis. Increased financial volatility has magnified the impact of fiscal conditions as drivers of sovereign risk, has widened the set of macroeconomic determinants, and has caused substantial interactions between fiscal and financial variables.
| Original language | English |
|---|---|
| Pages (from-to) | 774-776 |
| Number of pages | 3 |
| Journal | Economics Letters |
| Volume | 117 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - 2012 |
| Externally published | Yes |
Keywords
- Cross-country panel
- Financial crisis
- Fiscal policy
- Refinancing risk
- Regime switch