In this paper we analyze macroeconomic interactions among trade unions, the central bank and the fiscal policymaker. We explicitly model trade unionsconcern for public expenditure, paving the way for an analysis of the potential gains from cooperation between the fiscal policymaker and the trade...

The empirical distinction between de facto and de jure exchange rate regimes raises a number of interesting questions. Which factors may induce a de facto peg? Why do countries enforce a peg but do not announce it? Why do countries 'break their promises'? In this paper we show that a stable...