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A meta-analysis of business cycle correlation between the euro area and CEECs : What do we know - and who cares?

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  • Fidrmuc, Jarko
  • Korhonen, Iikka

Abstract

We review the literature on business-cycle correlation between the euro area and Central and Eastern European countries (CEECs), a topic that has gained attention in recent years as new EU entrants prepare for participation in the monetary union.Our meta-analysis suggests several CEECs already have comparably high correlation with the euro area business cycle.We also find that estimation methodologies can have a significant effect on correlation coefficients.While central bankers are more conservative in their estimates, we find no evidence of a geographical bias in the studies.JEL-Numbers: C42, E32, F15, F31.Key words: monetary union, optimum currency area, business cycles, meta- analysis.

Suggested Citation

  • Fidrmuc, Jarko & Korhonen, Iikka, 2004. "A meta-analysis of business cycle correlation between the euro area and CEECs : What do we know - and who cares?," BOFIT Discussion Papers 20/2004, Bank of Finland, Institute for Economies in Transition.
    • Handle: RePEc:bof:bofitp:2004_020
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    More about this item

    Keywords

    monetary union; optimum currency area; business cycles; meta- analysis.;
    All these keywords.

    JEL classification:

    • C42 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Survey Methods
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F15 - International Economics - - Trade - - - Economic Integration
    • F31 - International Economics - - International Finance - - - Foreign Exchange

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