Title: Asymmetries in monetary policy transmission: Some implications for EMU and its enlargement
Authors: De Grauwe, Paul ×
Senegas, MA #
Issue Date: Nov-2004
Publisher: Blackwell publ ltd
Series Title: Journal of common market studies vol:42 issue:4 pages:757-773
Abstract: In this article we analyse how the enlargement of a monetary union may affect the design of the common monetary policy when the latter transmits asymmetrically between the member countries. We find that the use of national information about inflation and unemployment in the design of the common monetary policy allows for tackling the heterogeneity induced by this asymmetry. This implies that if enlargement contributes to augmenting the transmission asymmetry of monetary policy in EMU, it will raise the need to take into account information about national economies in the formulation of optimal monetary policies in the monetary union. Furthermore, the choice for a new EU Member State to enter EMU will also depend on the monetary strategy implemented by the European Central Bank and, in particular, whether the latter would take the asymmetries in the transmission of monetary policy actions into account.
ISSN: 0021-9886
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Research Center of International Economics, Leuven
× corresponding author
# (joint) last author

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