Coordination des Politiques Budgétaires dans une Union Monétaires Hétérogène: Modélisation et Application à l'UEM Coordination of Budgetary Policies in a Heterogeneous Monetary Union: Modelisation and Application

This paper studies coordination of Fiscal policies in a monetary union in terms of sta- bilization performance. We use a static model of closed monetary union and numerical simulations in which macroeconomic heterogeneities are introduced. Results show that the coordination is an e¢ cient tool to increase EMU stabilization, even though coordin- ation gains greatly varies according to macroeconomic heterogeneities. We then identify coalitions and free riding behaviours.