A stochastic simulation model of an optimum currency area
Michel Beine () and
Frédéric Docquier ()
ULB Institutional Repository from ULB -- Universite Libre de Bruxelles
In this paper, we develop a two-country stochastic simulation model based on the theory of optimum currency areas, which studies the desirability of a monetary union. Extending the general equilibrium model of Ricci (1995), we introduce the intertemporal dimension, which allows to deal more accurately with labor mobility and shock dynamics. We analyse the importance of shocks asymmetries and investigate the role of labor mobility. Furthermore, we illustrate the influence of trade openness and the impact of a fiscal federalism system, assuming a specific transfer allocation rule based on the relative evolution of unemployment between the two countries.
References: Add references at CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed
Published in: Open Economies Review (1998) v.9 nÂ° 3,p.227-255
There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.
Journal Article: A Stochastic Simulation Model of an Optimum Currency Area (1998)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ulb:ulbeco:2013/10461
Ordering information: This working paper can be ordered from
http://hdl.handle.ne ... ulb.ac.be:2013/10461
Access Statistics for this paper
More papers in ULB Institutional Repository from ULB -- Universite Libre de Bruxelles Contact information at EDIRC.
Bibliographic data for series maintained by Benoit Pauwels ().