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Balkan and Mediterranean Candidates for European Union Membership: The Convergence of their Monetary Policy with that of the European Central Bank

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  • Josef C. Brada

    ()

  • Ali M. Kutan

    ()

Abstract

We compare the convergence with German monetary policy of the Balkan and Mediterranean country candidates for EU membership with that of countries that have recently joined the EU. Significant linkages exist between German base money stock and that of recent members of the EU; the same holds true for some of the Mediterranean region candidates for EU membership and for Slovenia and Croatia. Among the other Balkan economies and Turkey, the ability to follow the policies of the Bundesbank is nonexistent. Such weak policy coordination suggests the need for strengthening the financial sectors of these countries, for macroeconomic stabilization and for a period in which they tie their policies more closely to the ECB before they can be considered serious candidates for EU membership.

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Bibliographic Info

Paper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number 456.

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Length: 15 pages
Date of creation: 01 Apr 2002
Date of revision:
Handle: RePEc:wdi:papers:2002-456

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Keywords: convergence; economic integration; monetary policy; transition economies; Balkans;

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Cited by:
  1. Alina M. Spiru, 2008. "Inflation Convergence In Central And Eastern European Economies," Journal of Information Systems & Operations Management, Romanian-American University, vol. 2(1), pages 289-316, July.
  2. Vesile Kutlu & Nese Kavrukkoca, 2007. "Evaluating the Maastricht Convergence Criteria for New Prospective European Union Members," Central Bank Review, Research and Monetary Policy Department, Central Bank of the Republic of Turkey, vol. 7(1), pages 13-26.
  3. A M Spiru, 2007. "Inflation convergence in the new EU member states," Working Papers 590260, Lancaster University Management School, Economics Department.
  4. Alina M. Spiru, 2008. "Inflation Convergence In Central And Eastern European Economies," Romanian Economic Business Review, Romanian-American University, vol. 3(4), pages 14-34, Winter.

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