Bayer, Christian; Kriwoluzky, Alexander; Müller, Gernot J. - 2023
How does a monetary union alter the impact of business cycle shocks at the household level? We develop a Heterogeneous … Agent New Keynesian model of two countries (HANK2) and show in closed form that a monetary union shifts the adjustment to a … shock horizontally - across countries - within the brackets of the union-wide wealth distribution rather than vertically …