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Euro adoption and growth in Central Europe: Managing a political process

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  • Eastward Enlargement of the Euro Zone
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Intereconomics

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References

  1. The new members from Central Europe are the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia.

  2. Robert Mundell: A Theory of Optimum Currency Areas, in: American Economic Review, Vol. 51, 1961, pp. 657–665.

  3. Peter B. Kenen: The Theory of Optimum Currency Areas: An Eclectic View, in: R. A. Mundell and A. K. Swoboda (eds.): Monetary Problems of the International Economy, Chicago 1969, University of Chicago Press.

  4. Ronald McKinnon: Optimum Currency Areas, in: American Economic Review, Vol. 53, 1963, pp. 207–222.

  5. See for instance Jeffey A. Frankel and Andrew K. Rose: The Endogenity of the Optimum Currency Area Criteria, in: The Economic Journal, Vol. 108, 1998, pp. 1009–1025; as well as Michael Bolle and Michael Neugart: How will the Euro shape European Economies, paper presented at the 4th Conference on Macroeconomic Analysis, University of Crete, 2000.

  6. A recent report by the Polish National Bank states that euro adoption should impose wage discipline and enhance wage flexibility: National Bank of Poland: A Report on the Costs and Benefits of Poland’s Adoption of the Euro, Drukarnia NBP, Warsaw 2004, edited by Jakub Borowski.

  7. This is due to the Balassa-Samuelson effect, which is estimated to add 1–2 points to consumer-price inflation in Central Europe: Mihály A. Kovács et al.: On the Estimated Size of the Balassa-Samuelson Effect in Five Central and Eastern European Countries, NBH Working Paper, No. 5, 2002.

  8. Cf William Easterly and Ross Levine: It’s Not Factor Accumulation: Stylized Facts and Growth Models, in: World Bank Economic Review, 2004 (forthcoming).

  9. Leslie Lipschitz, Timothy Lane and Alex Mourmouras: Capital Flows to Transition Countries: Master or Servant?, IMF Working Paper, WP/02/11, 2002.

  10. Jeffey A. Frankel and Andrew K. Rose: Estimating the Effect of Currency Unions on Trade and Output, NBER Working Paper, No. 7857, 2000.

  11. See also Susan Schadler: Charting a Course Toward Successful Euro Adoption, in: Finance & Development, June 2004, pp. 29–33.

  12. Cf George Clarke, Robert Cull, Maria Soledad Martinez Peria and Susana M. Sánchez: Foreign Bank Entry: Experience, Implications for Developing Countries, and Agenda for further Research, in: Background Paper for the World Development Report 2002.

  13. Helmut Wagner: Pitfalls in the European Enlargement Process. Financial Instability and Real Divergence, in: Deutsche Bundesbank Economic Research Centre: Discussion Paper No. 6, 2002, pp. 18–24.

  14. Cf Sjef Ederveen, Henri L. F. de Groot and Richard Nahuis: Fertile Soil for Structural Funds?, in: Tinbergen Institute Discussion Paper, 2002, No. 096/3.

  15. In a later article, Robert Mundell picks up this argument. Cf. Robert Mundell: Uncommon Arguments for Common Currencies”, in: H. Johnson, A. Swoboda (eds.): The Economics of Common Currencies, London 1973, pp. 114–132.

  16. See for instance Susan Schadler, op. cit. Charting a Course Toward Successful Euro Adoption, in: Finance & Development, June 2004, pp. 29–33.

  17. Cf Leslie Lipschitz, Timothy Lane and Alex Mourmouras: Real Convergence, Capital Flows, and Monetary Policy: Notes on the European Transition Countries, IMF, mimeo 2004.

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Authors and Affiliations

  1. Jean Monnet Centre of Excellence for European Integration, Free University of Berlin, Germany

    Michael Bolle (Professor of international political economy) & Thomas Meyer (Senior research assistant)

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  1. Michael Bolle
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  2. Thomas Meyer
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and coordinator ofEzoneplus, an international research project on the Eastward Enlargement of the Eurozone within the European Union’s Fifth Framework Programme.

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Bolle, M., Meyer, T. Euro adoption and growth in Central Europe: Managing a political process. Intereconomics 39, 236–241 (2004). https://doi.org/10.1007/BF03031780

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