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Endogenous Imbalances in a Single Currency Area

Author

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  • Eszter Boros

    (Magyar Nemzeti Bank)

Abstract

This paper aims to identify the risks and real economic drivers of crises inherent in the monetary union over and above the current institutional challenges, seeking an answer to what fundamentally drives possible economic disturbances and what may impede the self-correction of markets. After analysing the available data, the author concludes that the euro area’s real economic homogeneity and market adjustment performance exhibit a mixed picture. The centre-periphery fault line may both give rise to and preserve imbalances. The author concludes that to prevent this and to reap the expected benefits of the euro, a comprehensive and targeted competitiveness, structural and regional policy framework is called for.

Suggested Citation

  • Eszter Boros, 2017. "Endogenous Imbalances in a Single Currency Area," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 16(2), pages 86-118.
    • Handle: RePEc:mnb:finrev:v:16:y:2017:i:2:p:86-118
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    File URL: http://english.hitelintezetiszemle.hu/letoltes/endogenous-imbalances-eszter-boros.pdf
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    References listed on IDEAS

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    Cited by:

    1. Tamás Bánfi, 2018. "The Euro and the Euro Area: Flawed Construct or Unfit Members?," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 17(1), pages 137-152.

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    More about this item

    Keywords

    single currency area; optimum currency areas; imbalances; euro area adjustment;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions

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