Some countries may face choice between targeting inflation independently and entering a monetary union that targets inflation. This paper shows that the choice of a country in favour of monetary union may be motivated by asymmetrical supply shocks. The demand shocks are neutralised under these...

In a two-period model with distortionay tax and public investment, we reexamine the interaction between monetary policy transparency and fiscal bias. We find that the optimal decisions of tax and public investment allow eliminating the effects of fiscal bias and hence neutralizing the impact of...

Cet article étudie la stabilité macroéconomique lorsque la Banque Centrale intègre dans sa règle du taux d'intérêt optimale les cours boursiers. Nous montrons que lorsque la Banque Centrale a une forte aversion pour l'inflation en attribuant un poids important à l'objectif de l'inflation...

The effects of quantitative easing policy, which looks like a “helicopter dropping” of money, are quite complex. Implemented following a major crisis induced by the deflation of bubbles on asset prices, this policy creates redistributive effects in favour of financial and banking...

In this paper we examine the macroeconomic stability in a simple dynamic open economy model, in which monetary authorities adopt an flexible inflation-targeting regime in an environment with a liberalised capital account and flexible exchange rates. In this respect, inflation targeting is an...

Dans cet article, nous étudions l’efficacité de politiques économiques dans un cadre d’une petite économie ouverte où la relation entre le taux de change, le prix des actions et le niveau d’activité est soumise à des interactions entre l’effet de “pass-through” incomplet et...

Résumé: Une zone-cible du taux d’inflation comporte une borne supérieure et une borne inférieure clairement annoncées par les autorités monétaires. Ces dernières assurent la crédibilité de cette zone par des interventions ponctuelles sur les marchés financiers lorsque le taux...

Using a New Keynesian small open economy model, we examine the effects of central bank transparency on inflation persistence. We have found that more opacity could reinforce the effect of persistent shocks on the level and variability of endogenous variables if the difference between the...

In this paper, we examine the link between political transparency of a common central bank (CCB) and decentralized supply-side fiscal policies in a monetary union. We find that the opacity of a conservative CCB has a restrictive effect on national fiscal policies since each government...

This paper investigates the dynamic implications of Krugman’s (1999) model of financial crises with balance-sheet effects, which has a considerable impact on the literature as well as the teaching of international financial crisis. By explicitly taking account of wealth accumulation and...