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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/10013214585
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/10013308484
When countries of different sizes participate in a cooperative agreement, the potential gain from deviation determines the minimum power that each country requires in the common decision-making. lt;brgt;lt;bRgt;This paper studies the problem in the context of a monetary union - multiple...
Persistent link: https://www.econbiz.de/10012774523
An optimum currency area is an economic unit composed of regions affected symmetrically by disturbances and between which labor and other factors of production flow freely. The symmetrical nature of disturbances and the high degree of factor mobility make it optimal to forsake nominal exchange...
Persistent link: https://www.econbiz.de/10013233455
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/10013100996
At a time of historic challenges to the viability of the Eurozone, we assess the contribution of the EU and the Euro to …
Persistent link: https://www.econbiz.de/10013135396
exist in most Eurozone countries. Although the European Central Bank managed the euro in a way that achieved a low rate of … Greek departure from the Eurozone …
Persistent link: https://www.econbiz.de/10013118129
Formation of the Euro area raises new questions about the coordination of monetary and fiscal policy. Using a New Neoclassical Synthesis (NNS) model, we show that a common monetary policy, responding to area-wide aggregates, has asymmetric effects on countries within the union, depending on...
Persistent link: https://www.econbiz.de/10013100660
In our European Economic Review (2002) paper, we used pre-1998 data on countries participating in and leaving currency unions to estimate the effect of currency unions on trade using (then-) conventional gravity models. In this paper, we use a variety of empirical gravity models to estimate the...
Persistent link: https://www.econbiz.de/10013015976
A common European bond would yield a common European Monetary Union risk free rate. We present tentative estimates of this common risk free for the European Monetary Union countries from 2004 to 2009 using variables motivated by a theoretical portfolio selection model. First, we analyze the...
Persistent link: https://www.econbiz.de/10013156250