In the study, the relevance of several optimum-currency-area (OCA) criteria is formally worked out in a welfare …, and consideration is given to how the welfare of the member countries of a currency union is affected by symmetric and … asymmetric national output shocks. The welfare implications are deduced both analytically and with the use of simulations. In a …

welfare than these other regimes. …

discretion and face model uncertainty. The analysis is based on a New Keynesian model where banks supply loans to transaction …

diametrically opposed to same under discretion. Maximum gains accrue from commitment relative to discretion in an open economy where …

-market-based debt from banks instead of issuing securities. Our results show that equity injections into banks are more welfare … that have initiated the stress and, at the same time, relax borrowing conditions. Outright purchases also increase welfare …

be summarised as follows. First, depending on the shock, robust optimal monetary policy under commitment responds either …