Kollmann, Robert - In: Journal of the European Economic Association 2 (2004) 2-3, pp. 289-301
This paper evaluates the welfare effects of a monetary union (MU), compared to a floating exchange rate regime, using a quantitative business cycle model of a two-country world with sticky prices. It is assumed that, under a float, there are shocks to the uncovered interest rate parity (UIP)...