Optimum Currency Areas Structural Changes and the Endogeneity of the OCA Criteria: Evidence from Six New EU Member States
AbstractThe present paper has two aims. The first aim is to test whether six new member states of the European Union (the six Central and Eastern European Countries) form an optimum currency area (OCA) with the eurozone, in an attempt to assess their readiness for euro adoption. The second aim is to examine whether the introduction of the euro in 1999 and the decision of the countries to seek to join the euro area created any forces fostering their convergence, evidence which would be in line with the theory on the endogeneity of the OCA criteria. Our findings indicate that the introduction of the euro did promote integration of the six new member states and that, at present, they are quite well aligned with the eurozone.
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Bibliographic InfoPaper provided by Bank of Greece in its series Working Papers with number 99.
Length: 30 pages
Date of creation: Jul 2009
Date of revision:
EU enlargement; OCA; real exchange rates; cointegration; GPPP.;
Other versions of this item:
- Dimitrios Sideris, 2011. "Optimum currency areas, structural changes and the endogeneity of the OCA criteria: evidence from six new EU member states," Applied Financial Economics, Taylor & Francis Journals, vol. 21(4), pages 195-206.
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
- F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
- F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-08-08 (All new papers)
- NEP-EEC-2009-08-08 (European Economics)
- NEP-IFN-2009-08-08 (International Finance)
- NEP-MON-2009-08-08 (Monetary Economics)
- NEP-TRA-2009-08-08 (Transition Economics)
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