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Alesina, Alberto - 2000

What is the optimal number of currencies in the world? Common currencies affect trading costs and, thereby, the amounts of trade, output, and consumption. From the perspective of monetary policy, the adoption of another country's currency trades off the benefits of commitment to price stability...

Persistent link: https://www.econbiz.de/10012470810

Fiscal Federalism and Optimum Currency Areas : Evidence for Europe From the United States

Sala-i-Martin, Xavier - 1991

The main goal of this paper is to estimate to what extent the federal government of the United States insures member states against regional income shocks. We find that a one dollar reduction in a region's per capita personal income triggers a decrease in federal taxes of about 34 cents and an...

Persistent link: https://www.econbiz.de/10012475134

A Tale of Politically-Failing Single-Currency Area

Razin, Assaf - 2012

and recovery patterns for key EU members like Germany and France, within the Eurozone, were similar. However, after the … bubble burst and the crisis began unfolding it became clear that the Eurozone plight differed from America's in one … fundamental respect. There was no exact counterpart of Eurozone GIIPS (Greece, Italy, Ireland, Portugal, and Spain) in the United …

Persistent link: https://www.econbiz.de/10012460307

Conditional PPP and Real Exchange Rate Convergence in the Euro Area

Bergin, Paul R. - 2016

While economic theory highlights the usefulness of flexible exchange rates in promoting adjustment in international relative prices, flexible exchange rates also can be a source of destabilizing shocks. We find that when countries joining the euro currency union abandoned their national exchange...

Persistent link: https://www.econbiz.de/10012456694

The Euro and Fiscal Policy

Fatas, Antonio - 2009

The paper provides and empirical characterization of fiscal policy in the euro area and in a group of twenty-two OECD economies over the period from 1970 until 2007. Using the cyclically-adjusted fiscal balance we document that policy in the euro area has been mildly pro-cyclical. The adoption...

Persistent link: https://www.econbiz.de/10012463925

Risk Sharing through Capital Gains

Balli, Faruk - 2011

We estimate channels of international risk sharing between European Monetary Union (EMU), European Union, and other OECD countries 1992-2007. We focus on risk sharing through savings, factor income flows, and capital gains. Risk sharing through factor income and capital gains was close to zero...

Persistent link: https://www.econbiz.de/10012461045

Business Cycles in the Euro Area

Giannone, Domenico - 2008

This paper shows that the EMU has not affected historical characteristics of member countries' business cycles and their cross-correlations. Member countries which had similar levels of GDP per-capita in the seventies have also experienced similar business cycles since then and no significant...

Persistent link: https://www.econbiz.de/10012464118

Shocks, Structures or Monetary Policies? The Euro Area and US After 2001

Christiano, Lawrence - 2007

The US Federal Reserve cut interest rates more vigorously in the recent recession than the European Central Bank did. By comparison with the Fed, the ECB followed a more measured course of action. We use an estimated dynamic general equilibrium model with financial frictions to show that...

Persistent link: https://www.econbiz.de/10012465125

The Endogeneity of the Optimum Currency Area Criteria

Frankel, Jeffrey A. - 1996

A country's suitability for entry into a currency union depends on a number of economic conditions. These include, inter alia, the intensity of trade with other potential members of the currency union, and the extent to which domestic business cycles are correlated with those of the other...

Persistent link: https://www.econbiz.de/10012473138

Aftershocks of Monetary Unification : Hysteresis with a Financial Twist

Bayoumi, Tamim - 2017

Once upon a time, in the 1990s, it was widely agreed that neither Europe nor the United States was an optimum currency area, although moderating this concern was the finding that it was possible to distinguish a regional core and periphery (Bayoumi and Eichengreen, 1993). Revisiting these...

Persistent link: https://www.econbiz.de/10012455476

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