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Fiscal federalism may not be a panacea in a monetary union if it does not address the non-cooperative behaviour between … extra instrument and a policymaker with union-wide objectives may not compensate the adding of a non-cooperative player to …
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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...
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