ABSTRACT. Grimm and Ried analyze monetary and fiscal policy interactions in a monetary union under various scenarios and elaborate which scenarios are preferable from a welfare perspective. Goodwin contends that if economic theory is to guide people toward the creation of economic systems that will promote well-being, it must first stop treating efficiency, consumption and economic growth as final goals. Diebold et al. assert that from a macroeconomic perspective, the short-term interest rate is a policy instrument under the direct control of the central bank.