Dynamic Adjustment of Fiscal Policy in Response to Asymmetric Economic Shocks: A Case Study of Eurozone Peripheral Economies
Keywords:
Fiscal Policy, Asymmetric Economic Shocks, Eurozone Peripheral Economies, Dynamic Stochastic General Equilibrium Model, Economic StabilityAbstract
This study critically examines the fiscal policy responses of Eurozone peripheral economies to asymmetric economic shocks between 2024 and 2026. Using a dynamic stochastic general equilibrium model, we analyze the efficacy of various fiscal instruments in stabilizing output and employment. Preliminary findings reveal that coordinated fiscal interventions significantly mitigate economic volatility, suggesting a paradigm shift in fiscal policy management within the Eurozone.
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