Erschienen in:FRB International Finance Discussion Paper ; No. 1012
Umfang:
1 Online-Ressource (63 p)
Sprache:
Englisch
DOI:
10.2139/ssrn.1769934
Identifikator:
Entstehung:
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments January 6, 2011 erstellt
Beschreibung:
This paper investigates the impact of the asymmetric shocks within a currency union in a framework that takes account of the zero bound constraint on policy rates, and also allows for constraints on fiscal policy. In this environment, we document that the usual optimal currency argument showing that the effects of shocks are mitigated to the extent that they are common across member states can be reversed. Countries can be worse off when their neighbors experience similar shocks, including policy-driven reductions in government spending