Has the Euro Affected the Choice of Invoicing Currency?

Jenny Ligthart and Sebastian E. V. Werner

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: We present a new approach to study empirically the effect of the introduction of the euro on the pattern of currency invoicing. Our approach uses a compositional multi- nominal logit model, in which currency choice is explained by both currency-specfic and country-specic determinants. We use unique quarterly panel data of Norwegian imports from OECD countries for the 1996-2006 period. We nd that eurozone countries have substantially increased their share of home currency invoicing after the introduction of the euro, whereas the home currency share of non-eurozone countries fell. In addition, the euro as a vehicle currency has overtaken the role of the US dollar in Norwegian imports. The substantial rise in producer currency invoicing by eurozone countries is primarily caused by a drop in in inflation volatility and can only to a small extent be explained by an unobserved euro effect.

JEL-codes: C25 E31 F33 F41 F42 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2011-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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https://cama.crawford.anu.edu.au/sites/default/fil ... hart_werner_2011.pdf (application/pdf)

Related works:
Journal Article: Has the euro affected the choice of invoicing currency? (2012)
Working Paper: Has the Euro affected the choice of invoicing currency? (2012)
Working Paper: Has the Euro Affected the Choice of Invoicing Currency? (2010)
Working Paper: Has the Euro Affected the Choice of Invoicing Currency? (2010)
Working Paper: Has the Euro Affected the Choice of Invoicing Currency? (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2011-03

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