In this paper we formalize the framework for monetary and exchange rate policy presented in Bofinger and Wollmershäuser [2001a]. We develop a simple comparative static model for an open economy that allows us to discuss monetary policy under the exchange rate strategies of independently...

The paper discusses alternative options for a future monetary order in the area of the Soviet Union. Its main focus is on two questions: Under what conditions would a common rouble currency area be compatible with fiscal discipline and effective financial control over the large numbers of...

We develop an institutional framework for central banks that try to pursue a stability-oriented monetary policy with the strategy of exchange rate targeting. Recent experience shows that a crucial element of this approach is to avoid destabilising capital inflows. Policy makers can exert...

Seit seiner Einführung am 1. Januar 1999 hat der Euro über ein Viertel seines Außenwertes verloren. Nachdem alle auf makroökonomischen Fundamentalfaktoren basierenden Ansätze die andauernde Schwäche der europäischen Währung nicht zu erklären vermochten, hat die These, dass die Schwäche...

Seit seiner Einführung am 1. Januar 1999 hat der Euro über ein Viertel seines Außenwertes verloren. Nachdem alle auf makroökonomischen Fundamentalfaktoren basierenden Ansätze die andauernde Schwäche der europäischen Währung nicht zu erklären vermochten, hat die These, dass die Schwäche...

We develop an institutional framework for central banks that try to pursue a stability-oriented monetary policy with the strategy of exchange rate targeting. Recent experience shows that a crucial element of this approach is to avoid destabilising capital inflows. Policy makers can exert...

The actual mainstream view of academics emphasizes the so-called two corner solution with either completely fixed or independently floating exchange rates. We will argue in this paper that the requirements for fixed rates are very restrictive to be successful. On the other hand, the advantage of...

We develop an institutional framework for central banks that try to pursue a stability-oriented monetary policy with the strategy of exchange rate targeting. Recent experience shows that a crucial element of this approach is to avoid destabilizing capital inflows. Policy makers can exert...

The paper discusses the institutional arrangements of a multilateral payments union for the Commonwealth of Independent States. It starts with an analysis of the risks of a non-cooperative solution, which would lead to serious liquidity and solvency problems and thus curtail inter-republican...