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Labour tax reforms, cross-country coordination and the monetary policy stance in the euro area : a structural model-based approach

Jacquinot, Pascal; Lozej, Matija; Pisani, Massimiliano - 2018

rest of the EA - REA), the US, and the rest of the world, region-specific labour markets with search and matching frictions …, and public employment. Our results are as follows. First, a permanent reduction in labour tax rates in the Home region … simultaneously in both Home and REA would have additional expansionary effects on the Home region. Third, in the short run the …