International Policy Coordination and Simple Monetary Policy Rules /

This paper studies the optimal design of monetary policy in an optimizing two-country sticky price model. We suppose that the production sequence of final consumption goods stretches across both countries and is associated with vertical trade. Prices of final consumption goods are sticky in the cons...

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Détails bibliographiques
Auteur principal: Berger, Wolfram
Autres auteurs: Wagner, Helmut
Format: Revue
Langue:English
Publié: Washington, D.C. : International Monetary Fund, 2006.
Collection:IMF Working Papers; Working Paper ; No. 2006/164
Accès en ligne:Full text available on IMF
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245 1 0 |a International Policy Coordination and Simple Monetary Policy Rules /  |c Wolfram Berger, Helmut Wagner. 
264 1 |a Washington, D.C. :  |b International Monetary Fund,  |c 2006. 
300 |a 1 online resource (28 pages) 
490 1 |a IMF Working Papers 
500 |a <strong>Off-Campus Access:</strong> No User ID or Password Required 
500 |a <strong>On-Campus Access:</strong> No User ID or Password Required 
506 |a Electronic access restricted to authorized BRAC University faculty, staff and students 
520 3 |a This paper studies the optimal design of monetary policy in an optimizing two-country sticky price model. We suppose that the production sequence of final consumption goods stretches across both countries and is associated with vertical trade. Prices of final consumption goods are sticky in the consumer's currency. Pursuing an inward-looking policy, as suggested in recent work, is not optimal in this set-up. We also ask which simple, id est non-optimal, targeting rule best supports the welfare maximizing policy. The results hinge critically on the degree of price flexibility and the relative importance of cost-push and productivity shocks. In many cases, a strict targeting of price indices like producer or consumer price indices is dominated by rules that allow for some fluctuations in prices such as nominal income or monetary targeting. 
538 |a Mode of access: Internet 
700 1 |a Wagner, Helmut. 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 2006/164 
856 4 0 |z Full text available on IMF  |u http://elibrary.imf.org/view/journals/001/2006/164/001.2006.issue-164-en.xml  |z IMF e-Library