Alexandre de Almeida Lima

Transmission of policy shocks among nations brings macroeconomic interdependence to the top of research. Following this idea, this work has as the main objective to study the macroeconomic interdependence between Brazil and Argentine, considering the Brazilian economy as the domestic economy and Argentine economy as the foreign one. Making use of time series empirical methodology of models of vector error correction (VEC). This work established the effects of an expansionary fiscal policy in the world over the Brazilian economy’s real monetary balances. The obtained results show that an expansionary fiscal policy in the world reduces the value of Brazilian economy’s real monetary balances, reducing therefore the purchasing power of domestic money, what generates an imporishing effect (beggar-thy-neighbor) as foreseen by the model of macroeconomic interdependence of Corsetti and Pesenti (2001).