We use a simple macroeconomic modeling of a monetary union made of two structurally heterogeneous countries, with distortions in the supply function. We find that higher taxes are always output stabilizing in the event of demand shocks, but that stronger automatic stabilizers are often inflation...

This paper propounds a revue of literature about the limits of the current European institutional framework. First, it appears that the status of the European Central Bank, and particularly its quasi exclusive aim to maintain the stability of prices, don’t ease the possibilities of...

In the context of a new Keynesian macroeconomic model, this paper studies the monetary policy that should be conducted by the common central bank of a monetary union. In the event of inflationary supply shocks, the optimal monetary policy should be all the more contractionary as the inflation...

On 5-6 September 2012 SUERF held its 30th Colloquium “States, Banks, and the Financing of the Economy” at the University of Zürich, Switzerland. The papers included in this SUERF Study are based on contributions to the Colloquium. All the chapters in this publication discuss from different...