Macroeconomic Effects of the European Monetary Union: A Counterfactual Analysis

Constantin Colonescu

Athens Journal of Business & Economics, 2017, vol. 3, issue 2, 171-186

Abstract: This is an empirical study on the effects of adopting a common currency, the euro, on a country’s GDP, inflation rate, and public debt. It uses a synthetic counterfactual method, which predicts how the economy of a euro area member country would perform if, hypothetically, the country did not join the euro area. The results show that there is no generally positive or negative effect of using a common currency, but individual countries fare differently in different periods. A novelty in this paper is determining confidence intervals in the counterfactual method. Some examples concern Greece.

Keywords: monetary union; euro; synthetic counterfactual (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:ate:journl:ajbev3i2-5

DOI: 10.30958/ajbe.3.2.5

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