Open Economies Review

, Volume 30, Issue 4, pp 719–737 | Cite as

Policy Coordination Under Model Disagreement and Uncertainty

  • Carsten HefekerEmail author
  • Michael Neugart
Research Article


What are the incentives for governments to coordinate their policies internationally when there is model disagreement and uncertainty? We build a model where countries disagree on policy targets and how policies affect the economies, and show that uncertainty not only determines the type of cooperative policy but also whether countries want to cooperate at all. Countries facing larger model disagreement also need to face larger uncertainty with respect to policy spillovers to agree on cooperation. Thus, uncertainty about spillovers can be a substitute for model agreement.


Policy coordination Uncertainty Ideological commitment Model disagreement 

JEL Classification

F42 F53 F55 F68 



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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.University of SiegenSiegenGermany
  2. 2.CESifoMünchenGermany
  3. 3.Technische Universität DarmstadtDarmstadtGermany

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