We measure the amount of central bank seigniorage generated in three economies in transition, and inquire to what extent seigniorage ultimately accrues to the government. We relate our findings to the institutional environment of the three countries. In particular we document that, in parallel...

We estimate two parsimonious structural models for inflation, the output gap, the domestic interest rate and the exchange rate for Hungary and Poland, for the period of "transition" (1991-1998). The empirical analysis shows that, at the aggregate level, the transmission of monetary policy...

In this paper we propose an approach to identify indipendently the parameters describing the structure of the economy from the parameters describing central bank preferences. We first estimate the parameters describing the structure of the US economy by considering a parsimonious specification...

We examine the relations between monetary and fiscal policies in the process of macroeconomic stabilization. Our model suggests that each policy maker prefers to be the second mover in a "Stackelberg" situation, i.e. where one policy makers precommits its policy choice. At the same time, both...

We estimate a small structural model for inflation, the output gap, the domestic interest rate and the exchange rate for Hungary during the period of the transition (1991-1999). The transmission of monetary policy impulses to macro variables is characterized in a similar fashion to that of...

The evaluation of the output cost of monetary stabilization is one of the main macro questions to be addressed when comparing alternative strategies and paths to monetary convergence in the economies in transition. In general, the evaluation of the output costs of stabilization (and hence of the...

We examine, in a suitable theoretical framework, the relations between monetary and fiscal policies within the European Economic and Monetary Union (EMU). Our stylized setup of EMU includes the following political agents, each endowed with an objective function: (i) A central authority (EC),...

The rate of inflation in the US has declined from an average of 4.5% in the period 1960-79 to an average of 3.6% in 1980-98. Between those two periods, the standard deviations of inflation and the output gap have also declined. These facts can be attributed to a shift in central bank...

Many recent studies on EMU have found business cycle asymmetries among potential members of the union to be quite relevant. Such asymmetries clearly decrease the balance of benefits versus costs for potential members of a monetary union and may also raise doubts on the feasibility of a common...

We estimate a small structural model for inflation, the output gap, the domestic interest rate and the exchange rate for Hungary during the period of the transition (1991-99). The transmission of monetary policy impulses to macro variables is characterized in a similar fashion to that of...