This article asks why unemployment performance in small countries in European Monetary Union has been superior to that in large EMU countries. Within a model of monopolistic competition, it is shown that a possible answer is a beggar-thy-neighbor policy by the small countries. When dropping the...

Using unit labor cost (ULC) data from Euro area countries as well as US States and German Länder we investigate inflation convergence using different approaches, namely panel unit root tests, co-integration tests and error-correction models. All in all we cannot reject convergence of ULC growth...

In this paper we investigate if the actual debate on divergences in the Euro area is indeed a reason to be concerned. We argue that the standard definition of divergence in terms of standard deviations is too narrow to capture the persistence in deviations in output, prices and wages. Our...

Using a modified version of the model presented by Belke and Gros (2007), we analyze the stability of adjustment in a currency union. Using econometric estimates for parameter values we check the stability conditions for the 11 original EMU countries and Greece. We found significant instability...

This paper compares relative unit labor cost developments in the countries of the euro area since the beginning of the European Monetary Union (EMU) both with historical developments and with intraregional developments in the United States and Germany. Unit labor cost indices for the U.S. states...

In letzter Zeit sind die Inflationsraten weltweit kräftig gestiegen. Als Reaktion erhöhte die Europäische Zentralbank (EZB) Anfang Juli ihren Leitzins. Jörg Krämer, Commerzbank, sieht diese Zinserhöhung als notwendig an, da die entscheidenden, langfristigen Inflationserwartungen im Laufe...

This paper compares relative unit labour cost developments in the countries of the euro-area since the beginning of the European Monetary Union (EMU) both with historical developments and with intra-regional unit labour cost developments in the United States of America and Germany. To this end,...

The paper develops a three-asset-portfolio model to analyse consequences of foreign exchange market operations by Asian central banks on the exchange rates between euro, dollar and yen. Both an analytical as well as a graphical solution is presented. It is found that -- contrary to public belief...

The paper develops a three-asset-portfolio model to analyse consequences of foreign exchange market operations by Asian central banks on the exchange rates between euro, dollar and an Asian currency. It is found that - contrary to public belief - the purchase of dollar assets by Asian central...