This paper arms central bank policy makers with ways to think about interactions between financial stability and monetary policy. We frame the issue of whether to integrate financial stability into monetary policy operating rules by appealing to the observation that in actual economies financial...

The paper studies the interaction between the monetary and fiscal authorities in the Euro area and the block of outside countries during the Third Stage of EMU. Restraints on fiscal policies and outside monetary policy are introduced as utility costs related to the use of the tax instruments...