In this paper, we measure the welfare costs/gains associated with financial market incompleteness in a monetary union. To do this, we build on a two-country model of a monetary union with sticky prices subject to asymmetric productivity shocks. For most plausible values of price stickiness, we...

In this paper, we measure the welfare costs/gains associated with financial market incompleteness in a monetary union. To do this, we build on a two-country model of a monetary union with sticky prices subject to asymmetric productivity shocks. For most plausible values of price stickiness, we...

The paper builds a two-country model of a monetary union with home bias and price stickiness. Incompleteness of financial asset markets is allowed. In this environment, we derive the solution for optimal behavior by the monetary policymaker and show that welfare can be higher under incomplete...

This paper investigates the impact of alternative monetary policy regimes on the creation of new varieties in open economies. Using a dynamic two-country model incorporating nominal rigidities, international trade and firm entries we compare an independent monetary policy regime to a monetary...

The Brexit issue has caused much concern regarding the future economic scenario of Europe in particular and the world in general. There are several reasons for Brexit. One of them is that the very nature of Monetary Unions is its rigidity. The 'one size fits all' yardstick won't apply to many...

The concept of political and economic integration has not progressed beyond the concept of a Nation-state. The primary reason is the trust deficit among citizens in a supra-national entity. We can use Blockchain systems-which are trustless networks-to resolve this issue. We can float a Regional...

In this paper, we measure the welfare costs/gains associated with financial market incompleteness in a monetary union. To do this, we build on a two-country model of a monetary union with sticky prices subject to asymmetric productivity shocks. For most plausible values of price stickiness, we...

The Eurosystem's large-scale asset purchases (quantitative easing, QE) induce a strong and persistent increase in excess reserves in the euro area banking sector. These excess reserves are heterogeneously distributed across euro area countries. This paper develops a two-country New Keynesian...

This paper assesses the suitability and constraints of having a unified currency in Association of Southeast Asian Nations (ASEAN) according to the optimum currency area theory and by analyzing the result of symmetry shocks of macroeconomic variables. The paper concludes that although there are...

Differential requirements for seigniorage provide a weak case for retaining monetary independence. As regards adjustment to asymmetric shocks, nominal exchange rate flexibility is at best a limited blessing and at worst a limited curse. Absence of significant fiscal redistribution mechanisms...