Research On The International Coordination Of Monetary Policy Taking Europe And The United States As Examples

As an important macroeconomic policy of a country,monetary policy undertakes the task of affecting the domestic output by adjusting the money supply to affect the interest rate.At the moment of economic globalization,all economies are closely linked and lead one country to another.Every country can not be alone and stay out of the country.The formulation of monetary policy in the country and its actual effect after its implementation are greatly affected by the policies of other economies.This kind of influence is particularly prominent among countries with close trade links and will generally be weakened to a certain degree.Extreme cases will be completely offset.Therefore,the conflict between the independence of domestic monetary policy and international coordination needs to be solved.The domestic monetary policy should not only point to domestic targets,such as full employment and inflation,but also reasonably anticipate the economic policies of other countries and make monetary policy choices that are most in line with their own interests,while also setting aside reasonable adjustments Space,the purpose is to avoid policy conflicts and retaliatory measures to reduce conflicts of interest and losses.The fact of the financial crisis has proved this point,and the two sides benefit.Based on the game model of the two countries,this paper uses the Stackelberg model to compare and analyze the welfare of the cooperation between China and the United States as a large open economy in the international monetary system.This paper first studies the theoretical basis,coordination mode and basic content of the international coordination of monetary policy.Secondly,based on the European-American relations,this paper uses the econometric model to conduct an empirical study of the monetary policy coordination between Europe and the United States.The study shows that the monetary policy of one country The international coordination of monetary policy by the authorities can make domestic inflation reach the optimal level,and the national welfare obtained is better than the result of the Stackelberg game.Therefore,the international coordination of monetary policy is necessary.In this context,the international coordination of monetary policy is manifested in the consideration of the externalities brought by the monetary policies of other large open economies to their own countries based on the global optimal perspective in the monetary policy decisions of large open economies.