International monetary policy cooperation revisited: conservatism and non-atomistic wage setting
This paper presents a simple model of policy coordination in line with the New Open Economy Macroeconomics literature. I extent the analysis on non-cooperative toward cooperative solutions by incorporating a collective wage bargaining system and conservative central banks. It turns out that previous results on international monetary policy cooperation are modified such that cooperation is welfare improving. The finding in the model relies on wage setters’ perceptions about affecting monetary policy. It is shown that under cooperation wage setters perceive a tighter monetary policy, thereby inducing wage restraints.
|Date of creation:||Jun 2009|
|Contact details of provider:|| Postal: EPFL - CDM - SFI - CFI, Odyssea, Station 5, CH-1015 Lausanne|
Phone: +41 21 693 00 77
Fax: +41 21 693 00 60
Web page: http://cfi.epfl.ch/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:cif:wpaper:200905. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Corinne Dubois)
If references are entirely missing, you can add them using this form.