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Is a Conservative Central Banker a (Perfect) Substitute for Wage Coordination?

Listed author(s):
  • Nicola Acocella

    ()

  • Giovanni Bartolomeo

In a monetary union, macroeconomic policies are strongly associated with externalities that seem to imply the need for macroeconomic policy coordination. However, if coordination is not complete, partial coordination might be unable to cope with the negative externalities arising from a decentralized policy management. This paper investigates different solutions for internalizing policy externalities. In particular, we compare wage coordination to the conservative central banker solution, which is found by recent literature able to impose wage moderation to the labor unions. We also discuss some aspects related to labor flexibility reforms as a solution for the unemployment problem.

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File URL: http://hdl.handle.net/10.1007/s10663-004-0813-9
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Article provided by Springer & Austrian Institute for Economic Research & Austrian Economic Association in its journal Empirica.

Volume (Year): 31 (2004)
Issue (Month): 2 (June)
Pages: 281-294

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Handle: RePEc:kap:empiri:v:31:y:2004:i:2:p:281-294
DOI: 10.1007/s10663-004-0813-9
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