Michael Carlberg Livres

Examining the interplay between monetary and fiscal policies in the euro area, this book delves into the dynamics of policy competition and cooperation among key institutions like the European Central Bank and major European governments. It highlights the objectives of price stability and full employment, exploring various strategies employed by policymakers. Unique features include numerical simulations and solutions that enrich the analysis. The work is part of a broader research initiative on European Monetary Union, with findings presented at numerous prestigious economic conferences.

This book studies unemployment and inflation in economic crises, first considering the scenario of a demand shock in Europe. In that case, monetary and fiscal interaction would cause widespread oscillations in European unemployment and European inflation. And what is more, there would be equally far-reaching fluctuations in the European money supply and European government purchases. These monetary and fiscal interactions would have no effects on the American economy. Second, it examines the scenario of a supply shock in Europe, in which monetary and fiscal interactions would have no effects on European unemployment or European inflation; there would also be an explosion of European government purchases and an implosion of the European money supply. Monetary and fiscal interactions would produce uniform oscillations in American unemployment and American inflation. Lastly, we would also see an implosion of both the American money supply and American government purchases.

Asset price bubbles refer to both real estate bubbles and stock market bubbles. The collapse of an asset price bubble means that asset prices go down while liabilities do not. As a result, millions of people have impaired balance sheets. Put another way, millions of people are in debt. In order to reduce their debt, they have to reduce their consumption. This in turn causes high and persistent unemployment. In other words, the described scenario leads to drastic economic consequences. For example, Japan experienced the so-called lost decade, which started in the early 1990s. More recently, large parts of the world economy were severely affected by the collapse of an asset price bubble in the United States. What can be done to mitigate the adverse effects of such a shock? To answer that question, this book provides a theoretical analysis of a Great Recession. The focus is on the economic consequences and possible policy measures. In order to account for the specific characteristics of such an event, the investigation is based on an IS-LM model with liquidity trap and zero crowding out. For several scenarios, the short-run, the medium-run and the long-run effects are explored. The book includes numerous examples and illustrations which help the reader to understand and proceed quickly.

This book studies the sustainability and optimality of public debt under different scenarios: the closed economy, the small open economy, and a two-country setting. Sustainability refers to the existence and the stability of the long-run equilibrium. Optimality relates to the path of public debt that maximizes discounted utility. The analysis is conducted within the framework of the Solow model, the overlapping generations model and the infinite horizon model. The government can follow different strategies, it either fixes the deficit ratio or the tax rate. As a result, a fixed deficit ratio generally can be sustained. By contrast, a fixed tax rate generally cannot be sustained. Depending on the chosen fiscal strategy, there exists either an optimal deficit ratio or an optimal tax rate that maximizes the sum of consumption and government purchases per capita.

This book studies the dynamics of monetary and fiscal interactions in the Euro Area. The policy makers are the European Central Bank and national governments. The primary target of the ECB is low inflation. And the primary target of a national government is low unemployment. However, there is a short-run trade-off between low inflation and low unemployment. Here the main focus is on sequential policy decisions. Another focus is on simultaneous and independent policy decisions. And a third focus is on policy cooperation. There are demand shocks, supply shocks, and mixed shocks. There are country-specific shocks and common shocks. The key question is: Given a shock, what are the dynamic characteristics of the resulting process?

This book examines the strategic interactions between monetary and fiscal policies within the world economy, divided into two regions, such as Europe and America. Central banks and governments act as policymakers, targeting low inflation, low unemployment, and low structural deficits amid various shocks—demand, supply, mixed, regional, and common. It develops a range of models from basic to advanced, focusing on Nash equilibrium. Key inquiries include whether policy interactions can mitigate existing losses following a shock and the extent of their effectiveness. Policy cooperation is also a significant topic, supported by numerous numerical examples. This work is part of a broader research project on European Monetary Union, with references provided at the end. Portions of the research were presented at several prestigious conferences, including the World Congress of the International Economic Association and the International Conference on Macroeconomic Analysis, among others. These presentations occurred at various workshops and seminars, showcasing the project's relevance to ongoing discussions in macroeconomic policy and international economics.

This book examines strategic policy interactions within a monetary union, focusing on the European Central Bank and national governments. The ECB aims for low inflation, while national governments prioritize low unemployment and structural deficits. It addresses various shocks—demand, supply, mixed, country-specific, and common—and develops a range of models from basic to advanced, emphasizing Nash equilibrium. Key questions include whether policy interactions can mitigate existing losses due to shocks and the extent of their effectiveness. Policy cooperation is also a significant topic, supported by numerous numerical examples. This work is part of a broader research project on European Monetary Union, with references provided at the end. Portions of the research have been presented at numerous prestigious conferences, including the World Congress of the International Economic Association and the International Conference on Macroeconomic Analysis, among others. These presentations highlight the book's contribution to ongoing discussions in the field of macroeconomics and monetary policy.

This book examines the coexistence of inflation and unemployment within a monetary union, focusing on strategies to mitigate the associated losses. The European Central Bank prioritizes low inflation, while the German and French governments aim for low unemployment in their respective countries. Each entity operates with a quadratic loss function. Key questions addressed include the effectiveness of sequential monetary and fiscal decisions in reducing inflation and unemployment losses, and whether cooperation between monetary and fiscal policies yields better outcomes. This work is part of a broader research initiative on the European Monetary Union, with references provided at the end. Portions of the research have been presented at various prestigious conferences, including the World Congress of the International Economic Association, the International Conference on Macroeconomic Analysis, and several workshops and seminars focused on international economics and macroeconomics. The findings contribute to the ongoing discourse on economic policy in the context of a monetary union, highlighting the complexities and interdependencies of inflation and unemployment management.

This book offers a practical yet sophisticated understanding of the macroeconomic principles essential for grasping a monetary union, defined as a group of countries sharing a common currency, with the euro area as a key example. It examines the roles of policymakers, including central banks, national governments, and labor unions, focusing on targets like price stability and full employment. The book discusses various strategies—cold-turkey or gradualist—and the sequential or simultaneous nature of policy decisions, highlighting differences in country size and behavior. It also addresses adaptive and rational policy expectations. To illustrate these concepts, the book includes numerical simulations of monetary, fiscal, and wage policies. This work is part of a broader research project on the European Monetary Union, with references provided at the end. Portions of the research have been presented at major conferences, including the World Congress of the International Economic Association and various workshops and seminars across Europe, showcasing its relevance in the field of macroeconomic analysis.

This book examines the interactions between monetary and wage policies in the euro area, focusing on policy competition and cooperation. It analyzes the dynamics between the European Central Bank, the American Central Bank, and labor unions in Germany and France. The study addresses higher-dimensional issues, targeting price stability and full employment, with policymakers employing either co-turkey or gradualist strategies. Decisions are made sequentially or simultaneously, highlighting the spillover effects of monetary and wage policies. A distinctive feature of this work includes numerical simulations for policy competition and solutions for policy cooperation. This research is part of a broader project on European Monetary Union, with references provided at the end. Portions of the research have been presented at various esteemed conferences, including the World Congress of the International Economic Association and the International Conference on Macroeconomic Analysis, among others. These presentations reflect the ongoing discourse in macroeconomic analysis and the implications of policy interactions within the euro area.