Growing too fast? Shock asymmetries and the Euro area enlargement

Marilyne Huchet () and Jean-Sébastien Pentecôte ()

Post-Print from HAL

Abstract: This study gives an empirical assessment of the Euro area enlargement. Following Bayoumi and Eichengreen (1993), asymmetries are measured by correlations among the structural shocks from a VAR. We address two questions: what is the impact of new adhesions on the stability of the enlarged union? Is the measurement of asymmetries robust to the identification of shocks? Using monthly data over 1995-2005, Slovenia and Greece stay at the periphery of the Euro area like Estonia and Lithuania, despite their adhesion to the EMU. While currency unions' endogeneity is supported by the greater symmetry between responses to the shocks, using long-run restrictions put the overall assessment into question.

Keywords: Euro area enlargement; optimal currency area; shock asymmetry; VAR identification (search for similar items in EconPapers)
Date: 2008
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00444849
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in Brussels Economic Review , 2008, 51 (1), pp.33-56

Downloads: (external link)
https://shs.hal.science/halshs-00444849/document (application/pdf)

Related works:
Journal Article: Growing too fast? Shock asymmetries and the Euro area enlargement (2008)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00444849

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().