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Monetary Determinants of Deposit Euroization in European Post-Transition Countries

  • Marina Tkalec

    ()

    (Institute of Economics, Zagreb, Croatia)

This paper investigates the long-run and short-run relationship between deposit euroization in twelve European post-transition economies and two determinants of deposit euroization that are under the influence of monetary policy: the exchange rate and the interest rate differential. The link between deposit euroization, exchange rates and interest rate differentials is investigated using Johansen cointegration and error correction models for each country separately. The results suggest that changes in both monetary drivers have significant effects on deposit euroization and are therefore important for explaining and fighting deposit euroization. Differences between exchange rate regimes, fixed and managed vs. floating, seem to matter for deposit euroization.

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File URL: http://www.panoeconomicus.rs/casopis/2013_1/05%20Marina%20Tkalec%20v2.pdf
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Article provided by Savez ekonomista Vojvodine, Novi Sad, Serbia in its journal Panoeconomicus.

Volume (Year): 60 (2013)
Issue (Month): 1 (March)
Pages: 89-101

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Handle: RePEc:voj:journl:v:60:y:2013:i:1:p:89-101
Contact details of provider: Web page: http://www.panoeconomicus.rs/

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  18. Charbel Cordahi & Jean-François Goux, 2007. "The international transmission of monetary shocks in a dollarized economy: The case of USA and Lebanon," Working Papers 0715, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
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  21. Marijana Ivanov & Marina Tkalec & Maruška Vizek, 2011. "The Determinants of Financial Euroization in a Post-Transition Country: Do Threshold Effects Matter?," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 61(3), pages 230-251, July.
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