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Monetary Unions and External Shocks

Author

Listed:
  • Etienne Farvaque

    (University of Lille 1)

  • Norimichi Matsueda

    (Kwansei Gakuin University)

Abstract

According to Bordo and James (2008), history shows that multinational monetary unions have dissolved mainly under the consequences of external shocks. This paper focuses on the effects of external shocks in assessing the sustainability of a monetary union and provides a theoretical argument that confirms their point.

Suggested Citation

  • Etienne Farvaque & Norimichi Matsueda, 2009. "Monetary Unions and External Shocks," Economics Bulletin, AccessEcon, vol. 29(2), pages 1483-1491.
    • Handle: RePEc:ebl:ecbull:eb-09-00202
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2009/Volume29/EB-09-V29-I2-P90.pdf
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    References listed on IDEAS

    as
    1. Frankel, Jeffrey A & Rose, Andrew K, 1998. "The Endogeneity of the Optimum Currency Area Criteria," Economic Journal, Royal Economic Society, vol. 108(449), pages 1009-1025, July.
    2. Michael Bordo & Harold James, 2008. "A Long Term Perspective on the Euro," European Economy - Economic Papers 2008 - 2015 307, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    3. Corinne Aaron-Cureau & Hubert Kempf, 2006. "Bargaining over monetary policy in a monetary union and the case for appointing an independent central banker," Oxford Economic Papers, Oxford University Press, vol. 58(1), pages 1-27, January.
    4. Rudi Dornbusch & Carlo Favero & Francesco Giavazzi, 1998. "Immediate challenges for the European Central Bank," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 13(26), pages 16-64.
    5. Frankel, Jeffrey A. & Rose, Andrew K., 1997. "Is EMU more justifiable ex post than ex ante?," European Economic Review, Elsevier, vol. 41(3-5), pages 753-760, April.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Yuta Saito, 2018. "Bargaining over Monetary Policy and Optimal Committee Composition in a Currency Union," Economics Bulletin, AccessEcon, vol. 38(4), pages 1986-1996.
    2. Yuta Saito, 2022. "A Note on Time Inconsistency and Endogenous Exits from a Currency Union," Games, MDPI, vol. 13(2), pages 1-8, February.
    3. Saito, Yuta, 2020. "A note on exit and inflation bias in a currency union," MPRA Paper 102717, University Library of Munich, Germany.

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    More about this item

    Keywords

    Monetary Union; Optimum Currency Areas; External Shocks;
    All these keywords.

    JEL classification:

    • F3 - International Economics - - International Finance
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit

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