Optimal monetary policy cooperation through state-independent contracts with targets
نویسنده
چکیده
Simple state-independent monetary institutions are shown to secure optimal cooperative policies in a stochastic, linear-quadratic two-country world with international policy spill-overs and national credibility problems. Institutions characterize delegation to independent central bankers facing quadratic performance related contracts punishing or rewarding deviations from primary and intermediate policy targets. ( 2000 Elsevier Science B.V. All rights reserved. JEL classixcation: E42; E58; F42
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