Breton, Régis; Rojas Breu, Mariana; Bignon, Vincent - Université Paris-Dauphine (Paris IX) - 2013
This paper analyzes a two-country model of money and banks to examine the conditions under which the creation of a … monetary union between two countries is optimal. Is is shown that if agents resort to banks to adjust their monetary holdings … different currencies, along with strictly positive conversion costs. A necessary condition for this is that credit market …