Macro Experiments on Reflexivity and Economic Crises

Información del proyecto

MacroReflEx

Identificador del acuerdo de subvención: 705574

DOI

10.3030/705574

Proyecto finalizado el 13 Septiembre 2016

Fecha de la firma de la CE 17 Marzo 2016

Fecha de inicio 1 Septiembre 2016

Fecha de finalización 31 Agosto 2018

Financiado con arreglo a

• EXCELLENT SCIENCE - Marie Skłodowska-Curie Actions

Coste total

€ 168 277,20

Aportación de la UE

€ 168 277,20

Coordinado por

UNIVERSITA CATTOLICA DEL SACRO CUORE
Italy

Objetivo

The MacroReflEx project studies fiscal policy design in the aftermath of an economic and a sovereign debt crises, like the ones that the Euro area has experienced following the 2007-8 financial crisis. The key research question is whether or under which conditions fiscal consolidation or fiscal stimulus is more desirable in such an economic downturn. Expectations of the economic actors play a central role, both in worsening economic downturns and in determining the success or failures of policies. For this reason, the project uses an original combination of laboratory experiments and heterogenous agent models that both put a strong emphasis on the understanding and the modeling of expectations dynamics.
Controlled laboratory environments recreate an environment in which expectations play a key role in shaping the aggregate dynamics, just like in real economies, but without assuming a specific expectation mechanism that may influence the conclusions of the exercise, as forecasts are directly elicited from the subjects. The experiments will shed light on three issues: Under what conditions can one observe bubble-like behavior that may amplify negative shocks? Are policy announcements able to revert those expectations and dampen those amplification mechanisms? If spreads are partly driven by non-fundamental factors, does it call for more fiscal consolidation or more stimulus?
The project then elaborates on the forecasts data collected in the experiments, and develops an heterogenous agent model with two objectives. First, the resulting model will provide a behavioral explanation of the observed patterns in the experiments. Second, it will allow us to perform a systematic policy analysis, both regarding ex ante, preventive policies, and ex post, counter-cyclical interventions. A particular challenge is to design a fiscal rule that summarizes in a systematic way the action of fiscal authorities, and can decrease the likelihood and the impact of such fiscal crises.

Palabras clave

• Macroeconomics
• Sovereign Risk
• Fiscal Policy
• Experimental Economics
• Heterogeneous Agent Models

Programa(s)

• H2020-EU.1.3. - EXCELLENT SCIENCE - Marie Skłodowska-Curie Actions PROGRAMA PRINCIPAL
  
• H2020-EU.1.3.2. - Nurturing excellence by means of cross-border and cross-sector mobility
  

Tema(s)

• MSCA-IF-2015-EF - Marie Skłodowska-Curie Individual Fellowships (IF-EF)
  

Régimen de financiación

MSCA-IF - Marie Skłodowska-Curie Individual Fellowships (IF)

Convocatoria de propuestas

H2020-MSCA-IF-2015

Coordinador

UNIVERSITA CATTOLICA DEL SACRO CUORE

• Aportación neta de la UEn: € 168 277,20
• Dirección: LARGO GEMELLI 1 ; 20123 MILANO ; Italia
• Región: Nord-Ovest › Lombardia › Milano
• Tipo de actividad: Higher or Secondary Education Establishments
• Coste total: € 168 277,20