Is commercial banking in the traditional sense obsolete?Are we in fact witnessing the emergence of a fundamentally new era of finance and payments intermediation?These questions are raised in this paper.Instead of a formal analysis, an attempt is made here to approach these questions from a...

This study is concerned with the determinants of monetary policy in the ERM countries.We derive a monetary policy rule, an interest rate rule, from a minimization problem faced by the central bank. The loss fuction trades off costs of interest rate instability against benefits from successful...

This paper analyses the prerequisites for and the results of unanimous monetary policy decisions in a monetary union consisting of heterogeneous members.The analysis is based on a multicountry version of Rogoff's model of the determination of monetary policy in the presence of supply shocks.It...

The study deals with the international transmission of economic shocks, their consequences for exchange rates and the reconciliation of exchange rate management with monetary policy. The theoretical part of the study consists of a mainstream model of two large, interdependent economies with...

This paper argues that, despite the substantial independence offered by the Maastricht Treaty, the ESCB will wish to bind itself by a set of voluntary rules in the conduct of monetary policy.This binding will occur because of the demands of policy itself.The ESCB as such has no history of a...

Using information from a variety of sources, including our own estimates from quarterly data for each of the countries over the period 1972-1997, this paper suggests that the exchange rate will play an important role in the transmission of the impact of monetary policy through to the real...

Both the optimal inflation target and the optimal degree of output stabilization are found to be conditional on the prevailing wage bargaining structure.If monopolistic wage setters act as strategic leaders of the monetary policy game, an explicit inflation targeting regime removes inflation...

In this paper we address the issue of how parameter uncertainty affects the optimal degree of central bank conservatism.The analysis is conducted in the standard macroeconomic model of a monetary policy game embedding an expectational Phillips-curve. Multiplicative "Brainard" uncertainty is...

This paper deals with the question of whether the euro area Phillips curve is nonlinear.There has recently been a great deal of discussion and studies concerning the same question in the US context.The data set includes most of the euro area countries, namely Austria, Germany, Finland, France,...

The aim of the present analysis is to shed light on the question whether Central Banks should publish their macroeconomic forecasts, and what could possibly be gained in monetary policy if they did so.We show that disclosing the Central Bank's assessment of the prevailing inflationary pressures...