International Coordination of Economic Policies: Scope, Methods, and Effects

Abstract

This paper discusses the scope, methods, and effects of international coordination of economic policies. In analyzing the scope for and of coordination, the paper addresses the rationale for coordination, barriers to coordination, the range and specificivity of policies to be coordinated, and the frequency of coordination. In evaluating the methods of coordination, the emphasis is on the broad issues of rules versus discretion, single-indicator versus multi-indicator systems, and hegemonic versus symmetric systems. Finally, using the MULTIMOD global macroeconomic model, some simulations are presented of several rule-based proposals for coordination.