“Nash” monetary equilibria be refined to be “coalition-proof” in the spirit of Bernheim et al. (1987). Our approach …

-cooperative solution yields the best results, the noncooperative solution fares worst and the coalition games lie in between, with a broad … coalition of the fiscally more responsible countries and the central bank against the less thrifty countries coming closest to …

coalition to less then n countries. Since the coalition members are bound by the union's discipline, an outsider can …

In Kohler (2002) we analyse coalition formation in monetary policy coordination games between n countries. We find that … positive spillovers of the coalition formation process and the resulting free-rider problem limit the stable coalition size …: since the coalition members are bound by the union's discipline, an outsider can successfully export inflation without …