Strategic policy interactions in a monetary union

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This book examines strategic policy interactions within a monetary union, focusing on the European Central Bank and national governments. The ECB aims for low inflation, while national governments prioritize low unemployment and structural deficits. It addresses various shocks—demand, supply, mixed, country-specific, and common—and develops a range of models from basic to advanced, emphasizing Nash equilibrium. Key questions include whether policy interactions can mitigate existing losses due to shocks and the extent of their effectiveness. Policy cooperation is also a significant topic, supported by numerous numerical examples. This work is part of a broader research project on European Monetary Union, with references provided at the end. Portions of the research have been presented at numerous prestigious conferences, including the World Congress of the International Economic Association and the International Conference on Macroeconomic Analysis, among others. These presentations highlight the book's contribution to ongoing discussions in the field of macroeconomics and monetary policy.