The Interaction of Monetary Policy and Wage Bargaining in the European Monetary Union : Lessons from the Endogenous Money Approach Sebastian Dullien gives a novel explanation for unemployment and inflation in the Euro Zone. He argues that unemployment stems from a lack of co operation between unions and monetary authorities: In an economy with endogenous money as EMU wage setters are responsible for price stability while the central bank is responsible for the level of output. Co operation between both actors is necessary for high employment and low inflation. The current institutional set up is found to be unable to assure cooperation