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Federal Monetary Policy

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  • Carsten Hefeker

Abstract

What is the optimal institutional structure for an independent central bank? The paper shows when it will be optimal for a country to have a central bank to be organized according to federal, purely national or a combination of both aspects. The analysis is then extended to a supranational monetary union and it is shown which organizational structure of a common central bank is optimal for participating countries and when they are willing to join. The implications for an enlargement of a monetary union are derived as well.

Suggested Citation

  • Carsten Hefeker, 2001. "Federal Monetary Policy," CESifo Working Paper Series 422, CESifo.
    • Handle: RePEc:ces:ceswps:_422
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