The aim of this master thesis is to empirically validate "hypothesis of twin deficits", resulting from Mundell-Fleming model, in the Czech Republic in years 1999-2010. The econometric method used was VAR models and Impulse Response Functions based on these models. Analysis proved that as a result of government deficit increase, through exchange rate appreciation, the balance of foreign trade deteriorates. Another fact discovered is that people are partially behaving as described by Ricardo-Barro equivalence. Their reaction on increased government deficit is increase of their personal savings as well as consumption. But increase of personal savings is not sufficiently compensating the deficit in government budget. Similar results were achieved also in analysis of government spendings.
| Identifer | oai:union.ndltd.org:nusl.cz/oai:invenio.nusl.cz:75585 |
| Date | January 2010 |
| Creators | Kužmová, Alexandra |
| Contributors | Kubíček, Jan, Tříska, Dušan |
| Publisher | Vysoká škola ekonomická v Praze |
| Source Sets | Czech ETDs |
| Language | Slovak |
| Detected Language | English |
| Type | info:eu-repo/semantics/masterThesis |
| Rights | info:eu-repo/semantics/restrictedAccess |
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