Do Currency Unions Deliver More Economic Integration than Fixed Exchange Rates? Evidence from the CFA and the ECCU

David Fielding and Kalvinder Shields

No 03/9, Discussion Papers in Economics from Division of Economics, School of Business, University of Leicester

Abstract: In this paper we develop a model to identify determinants of macroeconomic integration in the African CFA Franc Zone and in Dollar-pegging Caribbean countries (including members of the East Caribbean Currency Union). These two groups of countries each comprise states using several different local currencies: on the one hand the BCEAO-CFA Franc and the BEAC-CFA Franc (both pegged to the Euro), on the other the ECCU Dollar and other national Dollar-pegged currencies. The purpose of the analysis is to distinguish the effect of monetary union on macroeconomic integration from the effect of pegging to a common OECD currency.

Keywords: Currency Unions; International Integration (search for similar items in EconPapers)
JEL-codes: F15 F33 (search for similar items in EconPapers)
Date: 2003-03
New Economics Papers: this item is included in nep-ifn and nep-rmg
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Citations: View citations in EconPapers (6)

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