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Everyone studying EMU cites the theory of Optimum Currency Areas: whether a country like Sweden should join the …) criterion in the future. (Further, even if Sweden does not enter EMU quickly, it will be more likely to satisfy the OCA criteria … to join EMU. <p> We review the OCA theory, highlighting the role of trade links and income links. Then we discuss and …
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Fixed and flexible exchange rates each have advantages, and a country has the right to choose the regime suited to its circumstances. Nevertheless, several arguments support the view that the de facto dollar peg may now have outlived its usefulness for China. (i) Although foreign exchange...
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: the euro. This paper econometrically estimates determinants of the shares of major currencies in the reserve holdings of ….9). The advent of the euro interrupts the continuity of the historical data set. So we estimate parameters on pre-1999 data …, and then use them to forecast the EMU era. The equation correctly predicts a (small) narrowing in the gap between the …
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