There is a broad consensus among economists that the increased interdependence that comes from sharing a common currency and a single monetary policy justifies some degree of economic policy coordination between euro area Member States. However, empirical studies have, thus far, offered...

Optimal monetary and fiscal policies within the European Economic and Monetary Union (EMU) are determined by simulating a global model under alternative assumptions about the objective function of the European Central Bank (ECB) and about cooperation vs. non-cooperation with fiscal...