Optimal monetary policy in a two country model with firm-level heterogeneity

Dudley Cooke

No 104, Globalization Institute Working Papers from Federal Reserve Bank of Dallas

Abstract: This paper studies non-cooperative monetary policy in a two country general equilibrium model where international economic integration is endogenised through firm-level heterogeneity and monopolistic competition. Economic integration between countries is a source of policy competition, generating higher long-run inflation, and increased gains from monetary cooperation.

Keywords: Price levels; Macroeconomics - Econometric models (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-cba, nep-dge, nep-mac, nep-mon and nep-opm
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:fip:feddgw:104

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