Optimal Strategy of Monetary and Fiscal Policy in Macedonia: an Economometric Analysis of Different Strategies for Achieving Macroeconomic Stability in the Republic of Macedonia

In assessing the relative costs and benefits associated with introducing a more active monetary and fiscal policy and a different exchange rate regime in the Republic of Macedonia, all econometrics results, using different methodologies (SVAR and VECM), show that introducing such policies in order to promote rapid economic growth could easy disturb macroeconomic stability (after having achieved it at a substantial cost) without any significant economic benefits.