Economics
Europe Awaits German Fiscal Cascade That Could Be Just a Trickle
- Germany enacted sweeping 130 billion-euro package in June
- The evidence on fiscal spillovers among countries is mixed
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Germany’s stimulus is offering policy makers a real-time experiment on how much such national aid helps other countries too, just as the coronavirus forces the region to confront its lack of fiscal integration.
European Union leaders are working on their first-ever plan for joint borrowing to help the bloc’s more vulnerable countries. But until that’s agreed, the boost due to permeate through its biggest economy will remain the biggest single effort available for anyone else to benefit from in the current crisis.