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A new optimum currency area index for the euro area
Kunovac, Davor; Rodriguez Palenzuela, Diego; Sun, Yiqiao - 2022
We propose a new and time-varying optimum currency area (OCA) index for the euro area in assessing the evolution of the OCA properties of the monetary union from an international business cycle perspective. It is derived from the relative importance of symmetric vs. asymmetric shocks that result...
Persistent link: https://www.econbiz.de/10013375123
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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
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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
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The international dimension of an incomplete EMU
Ioannou, Demosthenes; Pagliari, Maria Sole; Stracca, Livio - 2020
This paper quantifies the economic influence that shocks to EMU cohesion, which in turn reflect the incomplete nature of the monetary union, have on the rest of the world. Disentangling euro area stress shocks and global risk aversion shocks based on a combination of sign, magnitude and...
Persistent link: https://www.econbiz.de/10012263010
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The Exchange Rate Susceptibility of Some European Core Industries and the Currency Union
Leuwer, David; Suessmuth, 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
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Fiscal spillovers in the euro area a model-based analysis
Attinasi, Maria-Grazia; Lalik, Magdalena; Vetlov, Igor - 2017
The fiscal consolidation measures adopted in many euro area countries over 2010-13 reduced excessive domestic fiscal imbalances, but came at the cost of short-term output losses. This simultaneous tightening of fiscal policy raised concerns that such output losses might be exacerbated by...
Persistent link: https://www.econbiz.de/10011636202
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Interactions between fiscal multipliers and sovereign risk premium during fiscal consolidation : model based assessment for the euro area
Lalik, Magdalena - 2017
The paper presents a model-based assessment of fiscal multipliers operating in the euro area during the period 2011-2014. The assessment is conditional on two distinct reactions of the sovereign risk premium (either responding endogenously to fiscal shocks or being an exogenous process) and two...
Persistent link: https://www.econbiz.de/10011637498
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How to Be Well Shod to Absorb Shocks? Shock Synchronization and Joining the Euro Zone
Gilson, Natacha (Nathalie) - 2021
This paper examines the demand and supply shocks observed in the present Eurozone member states and those observed in … some neighboring countries. The analysis is based on recent data and each Eurozone member country is compared with an … aggregate series corresponding to an area made up of the entire Eurozone minus the country being compared. The results of the …
Persistent link: https://www.econbiz.de/10013317269
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Fiscal Transfers in a Monetary Union with Exit Option
Hefeker, Carsten - 2015
It is widely debated whether a monetary union has to be accompanied by a fiscal transfer scheme to accommodate asymmetric shocks. We build a model of a monetary union with a central bank and two heterogeneous countries that are linked by a fiscal transfer scheme with repercussions on monetary...
Persistent link: https://www.econbiz.de/10013025966
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Endogeneities of optimum currency areas : what brings countries sharing a single currency closer together?
De Grauwe, Paul (contributor);  … - 2005
This paper brings together several strands of the literature on the endogenous effects of monetary integration: i.e., whether sharing a single currency may set in motion forces bringing countries closer together. The start of EMU has spurred a new interest in this debate. Four areas are...
Persistent link: https://www.econbiz.de/10002821109