In this paper, we highlight knowledge as specific channel through which labour mobility affects conditional within-firm wage dispersion. We present a model in which workers acquire knowledge on the job and firms pursue a policy of learning-by-hiring. The latter generates workers flows that...

In this paper, the consequences on financial stability of the institutional design envisaged in the Maastricht Treaty – which implicitly assigns the objective of financial stability to the National Central Banks (NCBs) – are assessed. The Maastricht Treaty spells out precisely the role of...

In this paper, we discuss a reform proposal for EMU macroeconomic institutions which rests on the generalised adoption of targets, for both monetary and fiscal policies, to be integrated by a system of checks and balances. The new arrangements for fiscal policies should induce EMU countries to...

We reconsider Svensson’s inflation-targeting proposal in a model where the need to raise seigniorage revenues determines the socially optimal inflation rate and distortionary taxes cause the inflation bias. Interpreting the targets as contracts, we show that the interaction between fiscal and...

There have been widespread criticisms of EMU fiscal institutions. We consider a simple alternative to the deficit ceilings envisaged in the Stability and Growth Pact. We advocate the adoption of deficit targets. National governments should retain discretion in setting deviations from targets,...

This paper applies the tools of insurance economics to address the trade-off between commitment and flexibility arising in monetary policy. Monetary regimes are considered as alternative insurance policies designed to stabilize output. This approach provides a simple and straightforward...