tag:blogger.com,1999:blog-1331441403058020963.post5262138050436349002..comments2024-03-28T06:49:24.930-04:00Comments on International Political Economy at the University of North Carolina: The ECB, Asymmetric Shocks, and Monetary Policy DilemmasThomas Oatleyhttp://www.blogger.com/profile/14092437150746625670noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-1331441403058020963.post-26174875962349333662007-12-08T09:33:00.000-05:002007-12-08T09:33:00.000-05:00In principle, no different at all. In the US conte...In principle, no different at all. In the US context, asymmetric shocks can and usually do provoke inter-regional financial transfers. In Germany, the unification shock prompted massive inter-regional transfers. In short, national governments use fiscal policy to channel resources from strong growth regions to areas hit by negative shocks. The EU lacks a fiscal policy capable of such transfers. And, the rules constrain national fiscal policies (though not in a fully binding manner).<BR/><BR/>The other solution is labor mobility; people in the low-growth area move to the high growth area. This happens often in the US; labor is less mobile in the EU.Thomas Oatleyhttps://www.blogger.com/profile/14092437150746625670noreply@blogger.comtag:blogger.com,1999:blog-1331441403058020963.post-79304723439664926212007-12-08T07:30:00.000-05:002007-12-08T07:30:00.000-05:00How is this different from inner American differen...How is this different from inner American differences (say between New York and Mississippi) or even a country as small as Germany (with West Germany having low unemployment, growth and population growth while East Germany has high unemployment (20% I believe), population loss (especially qualified people, no growth (again, I believe, it is lower in any case), one could even be more specific and point to the Ruhr area and its adjustment problems with its coal industry; to make a long question short, why is the ECB a worse idea than the Fed or the Bundesbank, in the end monetary policy will be a blunt tool and someone will suffer under it in any case?!?Benjamin Thomas Sutpenhttps://www.blogger.com/profile/07657026660772257313noreply@blogger.com