The article explores how different policies can help stabilize the economy in a monetary union with varying credit costs. It shows that when there are differences in inflation rates or credit costs between countries, fiscal policy becomes more important for stabilizing the economy. The study suggests that the efficiency of monetary policy decreases in such situations, leading to increased reliance on fiscal measures for stability. The size of the credit cost difference affects the welfare losses, with the impact varying based on whether interest rates are used to control demand or supply.