Journal article
Monetary cooperation during global inflation surges
- Abstract:
- We study optimal monetary policy during times of global scarcity of tradable goods. The optimal monetary response entails a surge in inflation, which helps rebalance production toward the tradable sector. While the inflation costs are fully borne domestically, however, the gains in terms of higher supply of tradable goods partly spill over to the rest of the world. National central banks may thus fall into a coordination trap and implement an excessively tight monetary policy causing an unnecessarily sharp global contraction.
- Publication status:
- Published
- Peer review status:
- Peer reviewed
Actions
Access Document
- Files:
-
-
(Preview, Accepted manuscript, pdf, 751.8KB, Terms of use)
-
- Publisher copy:
- 10.1257/aer.20231018
Authors
+ UK Research and Innovation
More from this funder
- Funder identifier:
- https://ror.org/001aqnf71
- Grant:
- EP/X027228/1
- Publisher:
- American Economic Association
- Journal:
- American Economic Review More from this journal
- Volume:
- 116
- Issue:
- 1
- Pages:
- 164-188
- Publication date:
- 2026-01-01
- DOI:
- EISSN:
-
1944-7981
- ISSN:
-
0002-8282
- Language:
-
English
- Keywords:
- Pubs id:
-
2355462
- Local pid:
-
pubs:2355462
- Deposit date:
-
2025-12-31
- ARK identifier:
Terms of use
- Copyright holder:
- American Economic Association
- Copyright date:
- 2026
- Rights statement:
- © 2026 American Economic Association. All rights reserved.
- Notes:
- The author accepted manuscript (AAM) of this paper has been made available under the University of Oxford's Open Access Publications Policy, and a CC BY public copyright licence has been applied.
- Licence:
- CC Attribution (CC BY)
If you are the owner of this record, you can report an update to it here: Report update to this record