Comments on “Is fiscal policy coordination desirable for a monetary union? An assessment from the perspective of a small open economy”

The paper criticises a previous essay by Cabral and García Díaz that provides a valuable analysis of how to organize a pegged exchange rate regime, but disregards elements that are crucial for interpreting the working of a process of regional integration and monetary unification, like the European Monetary Union. These elements are related to the need to defend the economies and the citizens from the growing instability generated by the working of a large, powerful and internationally integrated financial system and to create a coordination process in which cooperation among the actors and loyalty to shared values play a central role.