Testing for Real Interest Rate Convergence in European Countries
We use cointegration tests that determine endogenously the regime shift to test for bilateral short-term and long-term real interest rate convergence in the European Monetary System in the 1979--1993 period. The results of these tests provide strong evidence in favour of bilateral real interest rate convergence between Germany and several countries in our sample, particularly for long-term real interest rates. This result carries the important policy implication that in several European countries monetary policy has lost some of its effectiveness as a stabilisation policy tool.
|Date of creation:||1998|
|Date of revision:||1998|
|Publication status:||Published in the Scottish Journal of Political Economy, Vol. 46, No. 2, 1999|
|Contact details of provider:|| Postal: |
Phone: +353-91 524411 ext. 2501
Fax: +353-91 524130
Web page: http://economics.nuigalway.ie
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:nig:wpaper:0024. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Srinivas Raghavendra)
If references are entirely missing, you can add them using this form.