Policy Coordination Under Model Disagreement and Uncertainty

Open Economies Review - What are the incentives for governments to coordinate their policies internationally when there is model disagreement and uncertainty? We build a model where countries...     

Federal Monetary Policy

What is the optimal institutional structure for a federal central bank? The framework developed in this paper is used to analyze under what conditions an individual region will prefer a monetary union to be organized according to regional or common influences and how a combination of both can be rationalized. The implications of an enlargement of a monetary union for changes in its institutional setup are also derived.     

Paradoxes in integration theory

This paper presents a formal analysis of how global welfare is affected by changing tariff and subsidy rates. The discussion stresses three types of reform whereby, surprisingly, trade liberalization has the potential to reduce world welfare: a multilateral equi-proportionate reduction of tariffs and subsidies; a reduction of a tariff or subsidy rate which is not extreme; and the formation of a customs union.     

Bank cooperation and banking policy in a monetary union: A political-economy perspective on EMU

Why do large European banks lobby for monetary union? We show in a game-theoretic model that montary union can trigger a change in the structure of the market for international banking transactions with asymmetric effects on profits: large banks are induced to cooperate internationally and gain from European Monetary Union (EMU), while small banks are likely to lose. Monetary union can be interpreted as a device for large banks to push small banks out of the market for cross-border financial services.