EconPapers    
Economics at your fingertips  
 

Adjustment in EMU: Is Convergence Assured?

Sebastian Dullien (), Ulrich Fritsche (), Ingrid Groessl () and Michael Paetz
Additional contact information
Ingrid Groessl: Department for Socioeconomics, Department for Economics, University of Hamburg

No 200907, Macroeconomics and Finance Series from University of Hamburg, Department of Socioeconomics

Abstract: 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 in the model for a large number of countries. We then simulate the adjustment process for some empirically observed parameter values and find that even for countries with relatively smooth adjustment, the adjustment to a price shock in EMU might take several decades.

Keywords: EMU; convergence; stability; inflation (search for similar items in EconPapers)
JEL-codes: E32 E61 C32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-eec, nep-mac and nep-mon
Date: 2009-09
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://www.wiso.uni-hamburg.de/repec/hepdoc/macppr_7_2009.pdf First version, 2009 (application/pdf)

Related works:
Working Paper: Adjustment in EMU: Is Convergence Assured? (2009) Downloads
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:hep:macppr:200907

Access Statistics for this paper

More papers in Macroeconomics and Finance Series from University of Hamburg, Department of Socioeconomics Contact information at EDIRC.
Bibliographic data for series maintained by Ulrich Fritsche ().

 
Page updated 2019-07-22
Handle: RePEc:hep:macppr:200907