International Policy Coordination
Coordination among national governments as they formulate macroeconomic policies has been proposed as a response to global integration among national markets. Policy coordination may be beneficial by preventing the externalities created by policy spillovers, as well as by promoting international risk sharing. The usefulness of coordination depends upon numerous characteristics of an economy, including the degree of openness in goods and asset markets.
KeywordsAsset market integration Beggar-thy-neighbour Bretton Woods system Commitment Coordinated solutions European Central Bank European Monetary Union Exchange rate targets Fiscal expansion Globalization Goods market integration Information sharing International capital flows International migration International policy coordination Keynesianism Labour market integration Microfoundations Monetary policy externalities Nash solutions Policy spillovers Risk sharing Sticky price Terms of trade
JEL ClassificationsF3 F23
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