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Shocking Aspects of European Monetary Unification

Bayoumi, Tamim - 2007

of adjustment to these shocks are then compared to the results from US regional data. We find that the underlying shocks … are significantly more idiosyncratic across EC countries than across US regions, which may indicate that the EC will find … neighbors, experience shocks of similar magnitude and cohesion as the US regions. EC countries also exhibit a slower response to …

Persistent link: https://www.econbiz.de/10012778838

Benefits and Spillovers of Greater Competition in Europe : A Macroeconomic Assesment

Bayoumi, Tamim; Laxton, Douglas; Pesenti, Paolo A. - 2021

and the US. Second, it may improve macroeconomic management by increasing the responsiveness of wages and prices to market …

Persistent link: https://www.econbiz.de/10013223084

Is Regionalism Simply a Diversion? Evidence from the Evolution of the EC and Efta

Bayoumi, Tamim; Eichengreen, Barry - 2021

This paper considers the impact on trade of preferential arrangements in Europe since the 1950s. Using a first difference version of the gravity model, we find that the EC and EFTA altered the pattern of international trade. We also find evidence of trade diversion in several cases, notably that...

Persistent link: https://www.econbiz.de/10013224188

The Distribution of Exchange Rates in the EMS

Engel, Charles M.; Hakkio, Craig S. - 2021

Exchange rates of currencies in the Exchange Rate Mechanism of the EMS are characterized by long periods of stability interrupted by periods of extreme volatility. The periods of volatility appear at times of realignments of the central parities and at times when the exchange rate is within the...

Persistent link: https://www.econbiz.de/10013239360

Exchange Rate Pass-Through and the Welfare Effects of the Euro

Devereux, Michael B.; Engel, Charles M.; Tille, Cédric - 2021

-rate volatility, much the way U.S. consumer prices already are. We show that this has profound consequences for both the volatility … and levels of macroeconomic aggregates in both the U.S. and Europe. We find that European welfare is enhanced, and, more … surprisingly U.S. shares in Europe's good fortune. Alternative assumptions about how pricing behavior will change lead to different …

Persistent link: https://www.econbiz.de/10013243930

Does "Aggregation Bias" Explain the PPP Puzzle?

Chen, Shiu‐Sheng; Engel, Charles M. - 2021

Recently, Imbs et. al. (2002) have claimed that much of the purchasing power parity puzzle can be explained by aggregation bias'. This paper re-examines aggregation bias. First, it clarifies the meaning of aggregation bias and its applicability to the PPP puzzle. Second, the size of the bias' is...

Persistent link: https://www.econbiz.de/10013245121

The Responsiveness of Consumer Prices to Exchange Rates and the Implications for Exchange-Rate Policy : A Survey of a Few Recent New Open-Economy

Engel, Charles M. - 2022

The traditional case for flexibility in nominal exchange rates assumes that there is nominal price stickiness that prevents relative prices from adjusting in response to real shocks. When prices are sticky in producers' currencies, nominal exchange rate changes can achieve the relative price...

Persistent link: https://www.econbiz.de/10013322319

Is There a Conflict between EC Enlargement and European Monetary Unification?

Bayoumi, Tamim; Eichengreen, Barry - 2022

. This leads us to distinguish an EC "core" (made up of Germany and its immediate neighbors) and an EC periphery (made up of …

Persistent link: https://www.econbiz.de/10013324014