oai:eiop.or.at:euirsc/P0134

Title:The Endogenity of the Optimum Currency Area Criteria, Trade, and Labour Market Rigidities: Implications for EMU Enlargement
Publisher:European University Institute: Roman Schuman Centre Working Papers
Creator:Jarko Fidrmuc
Subject:international trade; EMU; unemployment; enlargement
Set:euirsc
Source:European University Institute: RSCAS Working Paper 16/04
Description:This paper analyzes two channels of business cycle convergence, which are subsequently applied to the EU acceding countries. First, trade intensity and intra-industry trade is found to induce a convergence of business cycles. This finding confirms the OCA endogeneity hypothesis. Second, labor market rigidities implying differences in transmission mechanisms lower the correlation of business cycles between the countries. Both effects are significant in a cross-section of OECD countries. Furthermore, the net effect implies a comparable degree of business cycle harmonization of Central and Eastern European countries with the EU as for the current members in the medium run.
Date:2004-10-15
Type:ERPA Paper
 
Type:Full text
Format:text/html
URL:http://www.eui.eu/ERPA/RSCAS/../../RSCAS/WP-Texts/04_16.pdf
 
Type:Full text
Format:text/html
URL:http://www.eui.eu/ERPA/RSCAS/../../RSCAS/WP-Texts/04_16.pdf

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