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Inflation Convergence During the Transition to EMU

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  • De Grauwe, Paul

Abstract

According to the Maastricht Treaty, EMS countries will be able to join EMU if their inflation rates are not more than 1.5% higher than the average of the three lowest inflation rates in the EMS. In this paper I analyse the likelihood of inflation rates converging to the levels set out in the Maastricht Treaty, and conclude that this is unlikely to be the case. I study whether the Maastricht convergence requirement for inflation rates is not needlessly tight.

Suggested Citation

  • De Grauwe, Paul, 1992. "Inflation Convergence During the Transition to EMU," CEPR Discussion Papers 658, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:658
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    Citations

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    Cited by:

    1. Kirrane, Chris, 1994. "Implications of EMU for the European Community," MPRA Paper 88998, University Library of Munich, Germany.
    2. Víctor Montuenga-Gómez, 2002. "Did the EMS encourage inflation convergence?," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 8(2), pages 119-127, May.
    3. Kocenda, Evzen & Papell, David H, 1997. "Inflation Convergence within the European Union: A Panel Data Analysis," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 2(3), pages 189-198, July.
    4. repec:kap:iaecre:v:8:y:2002:i:2:p:119-127 is not listed on IDEAS
    5. Hiroo Taguchi, 1994. "On the Internationalization of the Japanese Yen," NBER Chapters, in: Macroeconomic Linkage: Savings, Exchange Rates, and Capital Flows, pages 335-357, National Bureau of Economic Research, Inc.
    6. Chris Kirrane, 2018. "Implications of EMU for the European Community," Papers 1805.12113, arXiv.org.
    7. Nikolay Nenovsky & Kalina Dimitrova, 2002. "Dual Inflation Under the Currency Board: The Challenges of Bulgarian EU Accession," William Davidson Institute Working Papers Series 487, William Davidson Institute at the University of Michigan.
    8. Nikolai Zoubanov, 2003. "Uneven Growth in a Monetary Union: on the Possible Implications for its Slow-Growing Members," CASE Network Studies and Analyses 0257, CASE-Center for Social and Economic Research.
    9. H. Van Gemert & N. Gruijters, 1994. "Patterns of financial change in the OECD area," BNL Quarterly Review, Banca Nazionale del Lavoro, vol. 47(190), pages 271-294.
    10. Hélène Erkel-Rousse, 1997. "Degré de flexibilité des marchés du travail, ajustement à des chocs asymétriques et union monétaire européenne," Économie et Prévision, Programme National Persée, vol. 128(2), pages 79-100.
    11. Lionel Fontagné & Christophe Deissenberg, 1997. "Présentation générale," Économie et Prévision, Programme National Persée, vol. 128(2), pages 1-14.
    12. MacDonald, Ronald & Wójcik, Cezary, 2008. "Catching-up and inflation differentials in a heterogeneous monetary union: Some implications for the euro area and new EU Member States," Economic Systems, Elsevier, vol. 32(1), pages 4-16, March.
    13. H. Van Gemert & N. Gruijters, 1994. "Patterns of financial change in the OECD area," Banca Nazionale del Lavoro Quarterly Review, Banca Nazionale del Lavoro, vol. 47(190), pages 271-294.

    More about this item

    Keywords

    Inflation; Monetary Union;

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • F15 - International Economics - - Trade - - - Economic Integration
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration

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