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E(M)U effects in global cross-border banking

Author

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  • Sander, Harald
  • Kleimeier, Stefanie
  • Heuchemer, Sylvia

Abstract

We demonstrate that the European Monetary Union (EMU) increases cross-border depositing but not lending among EMU countries by 31%. While being a member of the European Union (EU) increases cross-border loans by 49%, cross-border deposit volumes are unaffected.

Suggested Citation

  • Sander, Harald & Kleimeier, Stefanie & Heuchemer, Sylvia, 2013. "E(M)U effects in global cross-border banking," Economics Letters, Elsevier, vol. 118(1), pages 91-93.
  • Handle: RePEc:eee:ecolet:v:118:y:2013:i:1:p:91-93 DOI: 10.1016/j.econlet.2012.09.028
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    References listed on IDEAS

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    1. Glick, Reuven & Rose, Andrew K., 2002. "Does a currency union affect trade? The time-series evidence," European Economic Review, Elsevier, vol. 46(6), pages 1125-1151, June.
    2. Portes, Richard & Rey, Helene, 2005. "The determinants of cross-border equity flows," Journal of International Economics, Elsevier, pages 269-296.
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    4. Martin, Philippe & Rey, Helene, 2004. "Financial super-markets: size matters for asset trade," Journal of International Economics, Elsevier, pages 335-361.
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    7. Andrew K. Rose, 2000. "One money, one market: the effect of common currencies on trade," Economic Policy, CEPR;CES;MSH, vol. 15(30), pages 7-46, April.
    8. Aviat, Antonin & Coeurdacier, Nicolas, 2007. "The geography of trade in goods and asset holdings," Journal of International Economics, Elsevier, vol. 71(1), pages 22-51, March.
    9. Sylvia Heuchemer & Stefanie Kleimeier & Harald Sander, 2009. "The Determinants of Cross-Border Lending in the Euro Zone," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 51(4), pages 467-499, December.
    10. Jeffrey Frankel & Andrew Rose, 2002. "An Estimate of the Effect of Common Currencies on Trade and Income," The Quarterly Journal of Economics, Oxford University Press, vol. 117(2), pages 437-466.
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    12. Philip R. Lane & Gian Maria Milesi-Ferretti, 2008. "International Investment Patterns," The Review of Economics and Statistics, MIT Press, pages 538-549.
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    Citations

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    Cited by:

    1. Iván Arribas & Jesús Peiró-Palomino & Emili Tortosa-Ausina, 2015. "Is full banking integration desirable?," Working Papers 2015/05, Economics Department, Universitat Jaume I, Castellón (Spain).
    2. Duijm, Patty & Schoenmaker, Dirk, 2017. "European Banks Straddling Borders: Risky or Rewarding?," CEPR Discussion Papers 12159, C.E.P.R. Discussion Papers.
    3. Kleimeier S. & Qi S. & Sander H., 2015. "Deposit insurance in times of crises : safe haven or regulatory arbitrage?," Research Memorandum 026, Maastricht University, Graduate School of Business and Economics (GSBE).

    More about this item

    Keywords

    Cross-border banking; Common currency effects; Banking market integration; Gravity model;

    JEL classification:

    • F3 - International Economics - - International Finance
    • G1 - Financial Economics - - General Financial Markets
    • G2 - Financial Economics - - Financial Institutions and Services

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