Efficiency of stability-oriented institutions: the European case

Fabrice Capoen () and Jerome Creel
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Fabrice Capoen: Université de Caen

No 2007-06, Documents de Travail de l'OFCE from Observatoire Francais des Conjonctures Economiques (OFCE)

Abstract: Stability-oriented European institutions correspond to the general prescriptions of the ‘new macroeconomics consensus’. This contribution provides an assessment of the pros and cons of these institutions in terms of macro stabilisation and exchange-rate swings drawing on different scenarios. We argue that the institutions which have been associated with the Euro – limits on public deficits and a conservative central bank – have somewhat jeopardized the efficiency of this new exchange-rate regime. Adaptation of institutions is thus needed: either cooperation or coordination may enhance European welfare.

Keywords: monetary policy, fiscal policy, central bank; stability pact; time-consistency; exchange rate, cooperation, coordination (search for similar items in EconPapers)
JEL-codes: E63 F41 H60 (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-cba, nep-eec, nep-ifn, nep-mac and nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Efficiency of stability-oriented institutions: the European case (2007)
Working Paper: Efficiency of stability-oriented institutions: the European case (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:fce:doctra:0706

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