Uncertainty and the choice of instruments in a two-country monetary-policy game
AbstractIn the two-country, monetary-policy game of this paper, each policymaker can choose his money supply or his interest rate as his instrument. With no uncertainty there are four noncooperative equilibria, one for each possible instrument pair. A policymaker is indifferent between instruments: his payoff depends not on his choice but on his opponent's. With uncertainty, the number of equilibria is reduced, sometimes to one. A policymaker is not indifferent between instruments; his payoff depends on his choice as well as on his opponent's. In some cases each policymaker prefers the equilibrium instrument choice of his opponent, but in others at least one would prefer another choice. Copyright Kluwer Academic Publishers 1990
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Springer in its journal Open Economies Review.
Volume (Year): 1 (1990)
Issue (Month): 1 (February)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=100323
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- William Poole, 1970.
"Optimal choice of monetary policy instruments in a simple stochastic macro model,"
57, Board of Governors of the Federal Reserve System (U.S.).
- Poole, William, 1970. "Optimal Choice of Monetary Policy Instruments in a Simple Stochastic Macro Model," The Quarterly Journal of Economics, MIT Press, vol. 84(2), pages 197-216, May.
- William Poole, 1969. "Optimal choice of monetary policy instruments in a simple stochastic macro model," Special Studies Papers 2, Board of Governors of the Federal Reserve System (U.S.).
- Kydland, Finn E & Prescott, Edward C, 1977. "Rules Rather Than Discretion: The Inconsistency of Optimal Plans," Journal of Political Economy, University of Chicago Press, vol. 85(3), pages 473-91, June.
- Robert J. Barro & David B. Gordon, 1984.
"Rules, Discretion and Reputation in a Model of Monetary Policy,"
NBER Working Papers
1079, National Bureau of Economic Research, Inc.
- Barro, Robert J. & Gordon, David B., 1983. "Rules, discretion and reputation in a model of monetary policy," Journal of Monetary Economics, Elsevier, vol. 12(1), pages 101-121.
- Giavazzi, Francesco & Giovannini, Alberto, 1986.
"Monetary Policy Interactions under Managed Exchange Rates,"
CEPR Discussion Papers
123, C.E.P.R. Discussion Papers.
- Giavazzi, Francesco & Giovannini, Alberto, 1989. "Monetary Policy Interactions under Managed Exchange Rates," Economica, London School of Economics and Political Science, vol. 56(222), pages 199-213, May.
- Stephen J. Turnovsky & Vasco d'Orey, 1989.
"The Choice of Monetary Instrument in Two Interdependent Economies Under Uncertainty,"
NBER Working Papers
2604, National Bureau of Economic Research, Inc.
- Turnovsky, Stephen J. & d'Orey, Vasco, 1989. "The choice of monetary instrument in two interdependent economies under uncertainty," Journal of Monetary Economics, Elsevier, vol. 23(1), pages 121-133, January.
- Stephen J. Turnovsky & Vasco d'Orey, 1987.
"Monetary Policies in Interdependent Economies with Stochastic Disturbances: A Strategic Approach,"
NBER Working Papers
1824, National Bureau of Economic Research, Inc.
- Turnovsky, Stephen J & d'Orey, Vasco, 1986. "Monetary Policies in Interdependent Economies with Stochastic Disturbances: A Strategic Approach," Economic Journal, Royal Economic Society, vol. 96(383), pages 696-721, September.
- Coenen, Günter & Lombardo, Giovanni & Smets, Frank & Straub, Roland, 2008.
"International transmission and monetary policy cooperation,"
Working Paper Series
0858, European Central Bank.
- Günter Coenen & Giovanni Lombardo & Frank Smets & Roland Straub, 2007. "International Transmission and Monetary Policy Cooperation," NBER Chapters, in: International Dimensions of Monetary Policy, pages 157-192 National Bureau of Economic Research, Inc.
- Hui, George W. L., 1995. "Flexible exchange rates, capital mobility, and monetary instruments of asymmetric economies," International Review of Economics & Finance, Elsevier, vol. 4(2), pages 149-169.
- Joseph Daniels & David VanHoose, 1998. "Two-Country Models of Monetary and Fiscal Policy: What Have We Learned? What More Can We Learn?," Open Economies Review, Springer, vol. 9(3), pages 265-284, July.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.