Resource title

Macroeconomic stabilization policies in the EMU : spillovers, asymmetries, and institutions

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Resource description

This paper studies the institutional design of the coordination of macroeconomic stabilization policies within a monetary union in the framework of linear quadratic differential games. A central role in the analysis plays the partitioned game approach of the endogenous coalition formation literature. The specific policy recommendations in the EMU context depend on the particular characteristics of the shocks and the economic structure. In the case of a common shock, fiscal coordination or full policy coordination is desirable. When asymmetric shocks are considered, fiscal coordination improves the performance but full policy coordination doesn?t produce further gains in policymakers? welfare.

Resource author

Giovanni Di Bartolomeo, Jacob Engwerda, Joseph Plasmans, Bas van Aarle, Tomasz Michalak

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/18740

Resource license

Adapt according to the presented license agreement and reference the original author.