Stability of Monetary Union with Outsiders

Hiroya Akiba

    研究成果: Article査読

    1 被引用数 (Scopus)

    抄録

    Abstract: This article examines stability of a three-country model which comprises a monetary union with two “ins” (i.e. members) and an “out” (i.e. non-member). This stability issue was examined by McAvinchey and McCausland who considered a hypothetical enlargement of Eurozone with a new member country, and empirically showed that the effects of enlargement are “predominantly destabilizing”. Using the Argy's method of exact log-linearization, we show that the model is intrinsically unstable. A numerical example is given with the 2010 parameter values. We found that the stability could ironically be rehabilitated when uncovered interest parity and purchasing power parity are violated.

    本文言語English
    ページ(範囲)151-166
    ページ数16
    ジャーナルGlobal Economic Review
    44
    2
    DOI
    出版ステータスPublished - 2015 4 3

    ASJC Scopus subject areas

    • Economics, Econometrics and Finance(all)
    • Business and International Management
    • Political Science and International Relations

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