September 15-16, 2011

Budapest, Hungary

Magyar Nemzeti Bank

Centre for Economic Policy Research

The Magyar Nemzeti Bank (MNB), in collaboration with the Centre for Economic Policy Research (CEPR), will hold its tenth Workshop on Macroeconomic Policy Research in Budapest on September 15-16, 2011.

With the onset of the current world financial crisis attention has been redirected towards the use of fiscal policy. After years of stimulus and a build-up of sizeable debt positions of the public sector, the focus is now shifting towards addressing the sustainability of these public debt positions, and on finding ways to an optimal fiscal consolidation process. An important issue for such a fiscal rebalancing process is finding the right timing and mix of financing (timing of fiscal retrenchment, tax increases versus expenditure cuts, and reforms in the tax system). Moreover, open economy aspects are becoming increasingly relevant for understanding the consequences of large outstanding public debt. These include aspects such as the role of a fiscal imbalance in causing external imbalances, the risk of sovereign debt defaults also in the industrialized world, and the design of policies to prevent these. The goal of the conference is to invite policy relevant theoretical and empirical academic contributions and bring together academic economists and central bank researchers to discuss these issues.

Topics of the 2011 meeting include:

1)    Public debt and the process of fiscal rebalancing: 

  • §  Sustainability considerations of public debt
  • §  Debt consolidation in times of recessions

2)    Fiscal Policy in a Globalized World 

  • §  Relation of fiscal debt and external debt
  • §  The role of foreign currency debt in external financing
  • §  Sovereign debt and the role of the public sector in country risk premia
  • §  Twin deficits

3)    Microeconomic aspects of public debt

  • §  Optimal mix of tax and spending measure in fiscal stimulus
  • §  Ways of financing public expenditure

Keynote Speakers:

•        Eric M. Leeper (Indiana University)

•        Carlos A. Végh (University of Maryland)

The workshop will be held at the Magyar Nemzeti Bank in Budapest. Participants from central banks are expected to cover costs of travel and local expenses. Costs of participants from academic institutions may be reimbursed by the organisers upon request. No conference fee will be charged.

Organising committee:

  • Péter Benczúr (MNB and Central European University)
  • István Kónya (MNB and Central European University)
  • Gernot Müller (University of Bonn and CEPR)
  • Katrin Rabitsch (MNB and Central European University)