This innovative new book re-examines the case for macroeconomic cooperation in a context of uncertainty, something that policymakers have long doubted. Using both theoretical models and empirical techniques, Atish Ghosh and Paul Masson argue that macroeconomic uncertainties, far from precluding international coordination, actually enhance its importance.
Features of the book include a new theoretical approach to policy coordination; advanced solution techniques for optimal policies in the face of uncertainty; and the use of sophisticated methods to consider real-world policy problems.
Written for students and professionals working in the fields of open economy macroeconomics and international relations, the book provides a comprehensive study of international economic policy cooperation, including the problems of negotiating and sustaining international agreements.
"Ghosh and Masson were the first to analyze model uncertainty in the context of racional decision making. And when they did they found that it could actually be an argument for policy coordination. Since this runs counter to the conventional wisdom of policy makers, it is a very important observation." Matthew B. Canzoneri- Professor of Economics, Georgetown University
2. A Theoretical Framework for Modelling the Open Economy.
3. The Theory of Policy Coordination Under Uncertainty.
4. An Example: The Stock market Crash of October 1987.
5. Alternative Empirical Models of the Open Economy.
6. Model Uncertainty and the Gains from Coordination: An Empirical Analysis.
7. Cooperation versus Coordination.
8. On the Sustainability of Cooperative Agreements.
9. Issues in Bargaining.
Appendix - Cooperation and Coordination in Historical Perspective.