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Monetary Union, Even Higher Integration, or Back to National Currencies?

Economides, George - 2016

This paper quantifies the welfare differences among a monetary union, flexible exchange rates (economic disintegration) and a monetary plus fiscal transfer union (higher economic integration). The vehicle of analysis is a medium-scale New Keynesian DSGE model consisting of two heterogeneous...

Persistent link: https://www.econbiz.de/10012996680

The Fragility of Two Monetary Regimes : The European Monetary System and the Eurozone

Ji, Yuemei - 2013

We analyze the similarities and the differences in the fragility of the European Monetary system (EMS) and the Eurozone … foreign exchange markets while in the Eurozone it was the absence of a lender of last resort in the long-term government bond … Eurozone the roles were reversed. The national central banks that became part of the Eurosystem were strengthened. This came at …

Persistent link: https://www.econbiz.de/10013072510

Fiscal Rules, Financial Stability and Optimal Currency Areas

De Grauwe, Paul - 2015

In this paper we suggest that Eurozone countries face a policy trade-off among: 1) a common rule imposing co … conclude that the intense fiscal rules that have been introduced in the Eurozone after the emergence of the debt crisis reduced …

Persistent link: https://www.econbiz.de/10013020581

Revenue for EMU : A Contribution to the Debate on Fiscal Union

Iara, Anna - 2016

In the wake of the euro area crisis, the debate on instruments to deepen economic integration among its members has intensified, among others putting forward a fiscal stabilization capacity for EMU members. Contributions made so far to further this idea have mostly concentrated on the...

Persistent link: https://www.econbiz.de/10012994790

Greece's Three-Act Tragedy : A Simple Model of Grexit vs. Staying Afloat Inside the Single Currency Area

Chen, Yu-Fu - 2016

Against the backdrop of the Greek three-act tragedy, we present a theoretical framework for studying Greece's recent debt and currency crisis. The model is built on two essential blocks: first, erratic macroeconomic policymaking in Greece is described using a stochastic regime-switching model;...

Persistent link: https://www.econbiz.de/10012999786

Catching-Up, Inflation Differentials and Credit Booms in a Heterogeneous Monetary Union : Some Implications for Emu and New EU Member States

MacDonald, Ronald - 2013

In this paper we propose an alternative explanation for the nature, sources and consequences of inflation rate differentials in a monetary union, such as EMU. To achieve this, we build on the new neoclassical synthesis (NNS) framework, recently advanced by Goodfriend (2002) and Goodfriend and...

Persistent link: https://www.econbiz.de/10012754168

Fiscal Federlism in a Monetary Union : The Cooperation Pitfall

Kempf, Hubert - 2018

Fiscal federalism may not be a panacea in a monetary union if it does not address the non-cooperative behaviour between fiscal policymakers. To prove this, we assess the relative merits of a fiscal federalism scheme in a monetary union and intergovernmental fiscal cooperation without such a...

Persistent link: https://www.econbiz.de/10012930695

The Exchange Rate Susceptibility of Some European Core Industries and the Currency Union

Leuwer, David; Süssmuth, Bernd - 2021

This paper investigates the relationship between real exchange rate changes and the German, French and UK automobile and mechanical engineering sector. In stylized models, exports decline whenever the domestic currency appreciates and vice versa. Strategic firm behavior, however, can obscure the...

Persistent link: https://www.econbiz.de/10013315771

The Euro and Inflation Uncertainty in the European Monetary Union

Caporale, Guglielmo Maria; Kontonikas, Alexandros - 2021

This paper investigates the relationship between inflation and inflation uncertainty in twelve EMU countries. A time-varying GARCH model is estimated to distinguish between short-run and steady-state inflation uncertainty. The effects of the introduction of the Euro in 1999 are then examined...

Persistent link: https://www.econbiz.de/10013317342

Oil and Vinegar : A Positive Fiscal Theory of the Euro Crisis

Blankart, Charles B. - 2013

The theory of optimal currency areas states that a currency union may succeed if the participating countries have complementary industry structures. If this is not the case a currency union does not, inevitably, have to fail because market forces will induce adjustments of the industry...

Persistent link: https://www.econbiz.de/10013074396