The wave of crises that began in 2008 reheated the debate on market deregulation as a tool to improve economic performance. This paper addresses the consequences of increased flexibility in goods and labor markets for the conduct of monetary policy in a monetary union. We model a two-country...

This paper studies the impact of product and labor market reforms when the economy faces major slack and a binding constraint on monetary policy easing---such as the zero lower bound. To this end, we build a two-country model with endogenous producer entry, labor market frictions, and nominal...

This paper studies the impact of product and labor market reforms when the economy facesmajor slack and a binding constraint on monetary policy easing. such as the zero lowerbound. To this end, we build a two-country model with endogenous producer entry, labormarket frictions, and nominal...