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Moving the Escudo into the Euro

In: Shaping the New Europe

Author

Listed:
  • Jorge Braga Macedo
  • Luís Catela Nunes
  • Francisco Covas

Abstract

It took ten years and two Prime Ministers (right then left) to make Portugal a founding member of the eurozone. The efforts of successive duos of five ministers of finance and three central bank governors were required and the euro conversion rate was set at 200 escudos, some 16 per cent lower than the rate at which the escudo entered the ECU basket in 1989. Moreover the implementation of a stability-oriented macroeconomic policy was completed at a time when the parity grid of the Exchange Rate Mechanism (ERM) of the European Monetary System was under severe strain.

Suggested Citation

  • Jorge Braga Macedo & Luís Catela Nunes & Francisco Covas, 2004. "Moving the Escudo into the Euro," Palgrave Macmillan Books, in: Michael A Landesmann & Dariusz K Rosati (ed.), Shaping the New Europe, chapter 9, pages 246-264, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-52369-2_10
    DOI: 10.1057/9780230523692_10
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    References listed on IDEAS

    as
    1. Bliss,Christopher & De Macedo,Jorge Braga (ed.), 1990. "Unity with Diversity in the European Economy," Cambridge Books, Cambridge University Press, number 9780521395205.
    2. Hamilton, James D. & Susmel, Raul, 1994. "Autoregressive conditional heteroskedasticity and changes in regime," Journal of Econometrics, Elsevier, vol. 64(1-2), pages 307-333.
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    Cited by:

    1. Lopes, José Mário & Nunes, Luis C., 2012. "A Markov regime switching model of crises and contagion: The case of the Iberian countries in the EMS," Journal of Macroeconomics, Elsevier, vol. 34(4), pages 1141-1153.

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    More about this item

    Keywords

    Exchange Rate; Central Bank; Monetary Union; Exchange Rate Regime; European Monetary System;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions

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