Cooper, Russell; Kempf, Hubert - National Bureau of Economic Research (NBER) - 1998
This paper explores the gains to monetary union. We consider a two-country overlapping generations model. Agents work … dominated by a monetary union, in which there is a single currency and a strong central bank that optimally chooses zero … inflation. As suggested by the European Commission's 1990 report, monetary union reduces the inefficiencies created by multiple …