Bajo-Rubio, Oscar <br/><br/>
Insurance Mechanisms against Asymmetric Shocks in a Monetary Union: A Proposal with an Application to EMU 

 -  2003.<br/>							 
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<br/><br/> In this paper, we present a simple, automatic insurance mechanism designed to cope with asymmetric shocks within a monetary union. This could be used as a starting point for a more developed policy instrument. This mechanism could be used as a shock indicator on changes in the unemployment rate of member countries, and financed through a fund consisting of contributions from the member countries as a percentage of their tax receipts. The fund would be distributed among the countries affected by a negative asymmetric shock, in proportion to the severity of the shock they experience. We will explain our proposal by applying it empirically to the European economic and monetary union.