E-mail alert  |  Contact  
Search:       Go  
Background  |   Sponsoring institutions  |   Editorial board   |   Advisory board   |   Associate editors
Call for papers  |   Submission guidelines  |   Editorial process
Current issue  |   Past issues  |  
September 2016 issue
List of authors
 
Ramos-Francia
Altavilla, Giannone, Lenza
Bluwstein, Canova
Wright
Boneva, Cloyne, Weale, Wieladek
Nagel
Arce, Hurtado, Thomas
Nuguer
Kaszab
Bayoumi
IJCB Home   Read the journal   Past issue
Past issues
2017
 
December
September
June
March
February
2016
 
December
September
June
March
2015
 
December
September
June
March
January
2014
 
December
September
June
March
2013
 
December
September
June
March
January
2012
 
December
September
June
March
January
2011
 
December
September
June
March
2010
 
December
September
June
March
2009
 
December
September
June
March
2008
 
December
September
June
March
2007
 
December
September
June
March
2006
 
December
September
June
March
2005
 
December
September
May

Policy Spillovers and Synergies in a Monetary Union

by Óscar Arce, Samuel Hurtado and Carlos Thomas
Banco de España

Abstract

We provide a general equilibrium framework for analyzing the effects of supply- and demand-side policies, and the potential synergies between them, in an asymmetric monetary union that faces a liquidity trap and a slow deleveraging process in its "periphery." We find that the joint implementation of pro-competition structural reforms in the periphery, a fiscal expansion in the "core," and forward guidance about the future path of nominal interest rates produces positive synergies between the three policies: forward guidance reinforces the expansionary effects of country-specific policies, and the latter in turn improve the effectiveness of forward guidance. Our results provide a case for complementing current unconventional monetary stimuli in the euro area with national efforts on the structural reform and fiscal fronts.

JEL Codes: E44, E63, D42.

 
Full article (PDF, 59 pages, 5836 kb)

Discussion by Andrea Ferrero