This article provides an analytical discussion of the adjustment to EU accession for an economy under alternative assumptions about monetary policy rules. The post-accession phase is characterized by rapid capital inflows and real exchange rate appreciation. If accession is combined with...

When monetary policy is constrained by the zero lower bound, fiscal policy can be used to achieve macro stabilization objectives. At the same time, fiscal policy is also a key policy variable within a single currency area that allow policy-makers to respond to regional demand asymmetries. How do...

Countries that specialize in commodity exports often exhibit a correlation between the relevant commodity price and the value of their currency. We explore a natural but littlestudied explanation for this correlation. An increase in the commodity price leads to increases in the future values of...