Price Convergence under EMU? First Estimates
AbstractThis paper examines whether European monetary union has lowered the degree of price dispersion among member countries. The difference-in-differences methodology is applied to four independent data sets containing prices of identical goods. While the results reported in the paper vary somewhat across goods, they provide little overall support of the European Commission's claim that the single currency would significantly deepen market integration among the euro-zone countries. Even though this should be viewed as preliminary evidence, it does suggest that there are other, more important impediments to market integration in the EU.
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Bibliographic InfoPaper provided by Department of Economics, University of St. Gallen in its series University of St. Gallen Department of Economics working paper series 2003 with number 2003-08.
Length: 27 pages
Date of creation: Apr 2003
Date of revision:
EMU; price convergence; difference-in-differences;
Other versions of this item:
- F15 - International Economics - - Trade - - - Economic Integration
- F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-05-08 (All new papers)
- NEP-EEC-2003-05-08 (European Economics)
- NEP-IFN-2003-05-08 (International Finance)
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