Trade theory and economic geography suggest that the removal of trade barriers is likely to bring about more economic specialisation and potentially more diverse development paths between countries and regions. Thus, the deepening and extending European integration should be accompanied by an...

The conditions under which European monetary policy is likely to be conducted are investigated by means of multi-variate time series modelling using aggregated data of all eleven European Monetary Union member states. A cointegration analysis identifies two stable long-run relationships, one of...