According to the Maastricht Treaty, EMS countries will be able to join EMU if their inflation rates are not more than 1.5% higher than the average of the three lowest inflation rates in the EMS. In this paper I analyse the likelihood of inflation rates converging to the levels set out in the...

This Paper begins with a discussion of the relation between economics and politics in the construction of EMU. It briefly considers how the structural characteristics of the European economies relate to the Single Market programme, and how this initiative of the late 1980s both built the...

The paper discusses the institutional arrangements of a multilateral payments union for the Commonwealth of Independent States. It starts with an analysis of the risks of a non-cooperative solution, which would lead to serious liquidity and solvency problems and thus curtail inter-republican...

The paper discusses alternative options for a future monetary order in the area of the Soviet Union. Its main focus is on two questions: Under what conditions would a common rouble currency area be compatible with fiscal discipline and effective financial control over the large numbers of...

This paper considers fiscal policy coordination in a European Economic and Monetary Union (EMU). We use an overlapping generations model which leads to departures from Barro-Ricardian neutrality. In our calibrated model, however, we find these departures to be rather small. Two models are...

For Africa, a regional customs union is unlikely to realise net welfare gains (in the sense of trade creation dominating trade diversion) which cannot be attained through unilateral trade liberalization. Unilateral reform has often failed in Africa, however. A regional customs union tied to...

We discuss sources of volatility and vulnerability in the CEECs during the transition and leading up to EU accession. The Paper emphasizes the role of the transition shock as a source of extreme volatility on a much larger scale than the one observed during crises in emerging markets. The low...

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

We develop a Heckscher-Ohlin-Ramsey model, combining dual techniques with classic geometric techniques from trade theory. This framework is used to explore the long-run general equilibrium effects of regional integration (preferential trade agreements). Emphasis is placed on positive mechanics...

We use a unique dataset on television prices across European countries and regions to investigate the sources of differences in price levels. Our findings are as follows: (i) Quality is a crucial determinant of price differences. Even in an integrated economic zone as Europe, rich economies tend...