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Can International Policy Coordination Really Be Counterproductive? / Carlo Carraro, Francesco Giavazzi.
- Format:
- Book
- Author/Creator:
- Carraro, Carlo.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w2669.
- NBER working paper series no. w2669
- Language:
- English
- Subjects (All):
- Monetary policy--Congresses.
- Monetary policy.
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 1988.
- Cambridge, Mass. : National Bureau of Economic Research, 1988.
- Summary:
- This paper shows that international policy coordination is not counterproductive in a world where the incentive to run beggar-thy-neighbor policies internationally arises from the inefficiency that characterizes, within each country, the interaction between policymakers and private agents. The domestic inefficiency arises from the presence of nominal contracts that give central banks the power to affect real variables. In this setting we show that international cooperation belongs to central banks' dominant strategy. The paper is motivated by a common and misleading interpretation of a paper by Rogoff [1985], namely that international cooperation may be counterproductive in the presence of a domestic inefficiency.
- Notes:
- Print version record
- July 1988.
- Includes bibliographical references.
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