Upper level textbook presenting a new view of monetary policy and monetary regimes.

The prevailing view among economists and policy makers is that money has no impact on production in a longer term characterised by full price and wage flexibility and rational expectations. This book presents a revisionist view of monetary policy and monetary regimes. It presents several new mechanisms, indicating that money affects long-term production. The consequent policy implications are also discussed, including: the uses of monetary policy and monetary regimes in achieving macroeconomic goals; the impact of an independent central bank; the effects of a movement from floating exchange rates to fixed exchange rates in a monetary union. In addition to the theoretical and policy discussions the book also contains a comprehensive survey of the current state of scholarship in this area. Designed as a textbook for advanced undergraduate and graduate students in macroeconomics, labour economics and finance, this book will also appeal to scholars and policy-makers.

Part I. Introduction and Main Assumptions: 1. Introduction
2. The wage formation process
3. The literature
Part II. The Impact of Monetary Policy and Inflation: 4. Imperfect integration of securities markets
5. Monopolistic competition in bank markets
6. Utility from securities holdings
7. Hysteresis effects from monetary policy
8. The impact of inflation on bank earnings
Part III. The Impact of Monetary Regimes: 9. Centralised wage formation
10. Fiscal policy
11. Price stability goal
12. Uncertainty concerning policy formation
13. Policy uncertainty in a fixed-but-adjustable exchange rate regime
14. The impact of uncertainty on wage-setting
Part IV. Policy Implications: 15. Policy implications of monetary non-neutrality
16. A microeconomic foundation.