This dissertation consists of three independent essays in Macroeconomics. The first essay analyzes monetary coordination between currency areas. It is shown that search frictions can generate the deviations from the law of one price and that each country is tempted to exploit these deviations by...

We analyze the gain from coordinating on inflation between currency areas. To do so, we integrate a monetary search model into open-economy macro to construct a microfoundation for exchange rates. Each currency derives a value from alleviating the difficulties in trade. With a matching process...

In this paper we integrate the recent development in monetary theory with international finance, in order to examine the coordination between two currency areas in setting long-run inflation. The model determines the value of each currency and the size of each currency area without requiring...

We integrate a monetary search model into open-economy macro to analyze the gains from coordinating on inflation. Search frictions and local congestion lead to a determinate exchange rate between two currencies. Relative prices deviate from the law of one price. Because the deviations depend on...