TY  - JOUR
AU  - Roubini,Nouriel
TI  - Leadership and Cooperation in the European Monetary System:  A          Simulation Approach
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 3044
PY  - 1989
Y2  - July 1989
UR  - http://www.nber.org/papers/w3044
L1  - http://www.nber.org/papers/w3044.pdf
N1  - Author contact info:
Nouriel Roubini
Department of Economics, KMC 7-83
Stern School of Business, New York University
44 West 4th Street
New York, NY  10012
Tel: 212/998-0886
Fax: 212/995-4218
E-Mail: nroubini@stern.nyu.edu
AB  - To assess the importance of economic interdependence and the potential gains from policy coordination in the European area, this paper analyzes the international transmission of policies and disturbances in a rational expectation dynamic general equilibrium simulation model of the work economy, and applies the analysis to the study of the European Monetary System. International spillover effects and potential gains from coordination appear to be small under the assumption of flexible exchange rates in the European area. The implications of a fixed rate EMS with German leadership are compared with those of a cooperative fixed exchange rate regime. Finally, capital controls under fixed rates fails to insure policy autonomy and insulation from external disturbances for the countries restricting the capital movements. 
ER  -