Monetary politics in a monetary union: A note on common agency with rational expectations

Michele Ruta

Economics Letters, 2008, vol. 101, issue 3, 196-198

Abstract: Is the politicisation of monetary policy in a currency union desirable? This paper shows that in a setting where political influence by national governments is modeled as a common agency game with rational expectations, the answer to this question crucially depends on whether the common central bank can commit to follow its policy.

Keywords: Common; agency; Political; pressures; European; Monetary; Union (search for similar items in EconPapers)
Date: 2008
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Citations: View citations in EconPapers (3)

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Working Paper: Monetary Politics in a Monetary Union: A Note on Common Agency with Rational Expectations (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:101:y:2008:i:3:p:196-198

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