Have a Break, Have a ... National Currency: When Do Monetary Unions Fall Apart?
AbstractHistorically, dissolutions of currency unions are not unusual. I use an annual panel data set covering 245 country pairs that use a common currency (of which 128 are dissolved) from 1948 through 1997 to characterize currency union exits. I find that departures from a currency union tend to occur when there is a large inflation differential between member countries, when the currency union involves a country which is closed to international trade and trade flows dry up, and when there is a change in the political status of a member. In general, however, macroeconomic factors have only little predictive power for currency union dissolutions.
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1113.
Date of creation: 2004
Date of revision:
monetary union; sovereign currency; dissolution; exit;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-05-02 (All new papers)
- NEP-HIS-2004-05-02 (Business, Economic & Financial History)
- NEP-IFN-2004-05-02 (International Finance)
- NEP-MON-2004-05-02 (Monetary Economics)
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- La prevalenza del declino
by Alberto Bagnai in Goofynomics on 2013-02-16 18:13:00
- Debito pubblico: quelli che âla monetizzazione si fa coi miniassegniâ¦â
by Alberto Bagnai in Il Fatto Quotidiano on 2014-04-08 06:52:45
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