European monetary policy and the ECB rotation model

This paper analyses the voting power of individual members of the ECB Governing Council and, in particular, that of the Executive Board in the light of recent information published by the ECB. Using the randomization scheme based on the multilinear extension of games, we modify the standard analysis in three ways. First, we include heterogeneous preferences of the Governing Council members. Second, we address the agenda-setting power of the ECB president. Third, we take into account the dynamic decision setting. We show that the rotation model is able to stabilize the position of the core countries of the euro area.