Template-Type: ReDIF-Paper 1.0
Author-Name: Vincenzo Cuciniello 
Author-X-Name-First: Vincenzo
Author-X-Name-Last: Cuciniello
Author-Email: vincenzo.cuciniello@epfl.ch
Author-Workplace-Name: Chair of International Finance, Ecole Polytechnique Federale de Lausanne (EPFL), Switzerland
Title: International monetary policy cooperation revisited: conservatism and non-atomistic wage setting
Abstract: This paper presents a simple model of policy coordination in line with the New Open Economy Macroeconomics literature. I extent the analysis on non-cooperative toward cooperative solutions by incorporating a collective wage bargaining system and conservative central banks. It turns out that previous results on international monetary policy cooperation are modified such that cooperation is welfare improving. The finding in the model relies on wage setters’ perceptions about affecting monetary policy. It is shown that under cooperation wage setters perceive a tighter monetary policy, thereby inducing wage restraints.
Length: 20 pages		
Creation-Date: 2009-06
Revision-Date:
Publication-Status: 
File-URL: http://infoscience.epfl.ch/record/141371/files/CFP2009_05_1.pdf
Number:
Classification-JEL: E58, F41, F42, J51
Keywords: Monetary policy games , International policy coordination , Central bank conservatism, Monopoly unions
Handle: RePEc:cif:wpaper:200905