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The Nominal Exchange Rate Implication of VAT Harmonization in EEC

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Author Info
Dai, Meixing

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Abstract

This paper examines, in a one-good two-country Cournot competition model, the implication of European VAT reform on the nominal exchange rate parities which will be pegged in the third stage of monetary union. As result of the reform, the deutchmark needs to be reevaluated so as to prevent generating systematic external disequilibrium of some other European countries, which is inconsistent with pegging nominal exchange parities of European currencies.

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File URL: http://mpra.ub.uni-muenchen.de/13860/
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Publisher Info
Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 13860.

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Date of creation: Sep 1995
Date of revision: Jun 1996
Handle: RePEc:pra:mprapa:13860

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Related research
Keywords: nominal exchange rate parities; value-added-tax reform; monetary union.;

Find related papers by JEL classification:
F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
F31 - International Economics - - International Finance - - - Foreign Exchange

References listed on IDEAS
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  1. Fender, John & Yip, Chong K., 1994. "Open economy macroeconomics under imperfect competition A two-country model," Journal of International Economics, Elsevier, vol. 37(1-2), pages 49-63, August. [Downloadable!] (restricted)
    Other versions:
  2. Dixon, H.D., 1992. "Imperfect Competition and Open Economy Macroeconomics," Economics Working Papers 1993-1, School of Economics and Management, University of Aarhus.
  3. Brander, James A., 1981. "Intra-industry trade in identical commodities," Journal of International Economics, Elsevier, vol. 11(1), pages 1-14, February. [Downloadable!] (restricted)
    Other versions:
  4. d'Aspremont, Claude & Dos Santos Ferreira, Rodolphe & Gerard-Varet, Louis-Andre, 1989. "Unemployment in an Extended Cournot Oligopoly Model," Oxford Economic Papers, Oxford University Press, vol. 41(3), pages 490-505, July. [Downloadable!] (restricted)
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