← Search

Journal of Financial Stability Vol. 16 2015

Trade intensity and output synchronisation: On the endogeneity properties of EMU

Guglielmo Maria Caporale1,2; Roberta De Santis; Alessandro Girardi3

1 German Institute for Economic Research · 2 Brunel University of London · 3 Istituto Nazionale di Statistica

Abstract

Using annual bilateral data over the period 1988–2011 for a panel of 26 industrialised and emerging economies, we analyse in a time-varying framework the determinants of output synchronisation in EMU (European Monetary Union) distinguishing between core and peripheral member states. The results support the specialisation paradigm rather than the endogeneity hypothesis. Evidence is found in the euro period of diverging patterns between the core and the peripheral EMU countries raising questions about the financial stability of EMU.

DOI
10.1016/j.jfs.2014.01.003
Volume
16
Pages
154-163
Language
en
Sources
bibtex:phds-export.bib openalex crossref

Cite