At one time, overnight interest rates used to be adjusted without announcement or explanation – “snugging” was a popular term of the late 1980s. The market would generally take a few days, and the general public considerably longer, to work out what was happening when monetary policy was changing. They usually had to wait longer again for an explanation of why it was changing.
As such, in tandem with well-targeted welfare policies, they are a key part of the policy toolbox for making openness sustainable. Implications for the global economy Clearly, the European model involves several unique features. In particular, it depends on a relatively advanced political structure that helps reconcile multilateral cooperation with democratic control, which is difficult to replicate elsewhere.