Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

OCA Indexes and Convergence Process in Europe

OCA Indexes and Convergence Process in Europe AbstractThis paper evaluates the European monetary convergence for period 2001 and 2013. The main purpose of this contribution is the estimation of the so-called OCA index, which indicates the proximity of two economic areas. The paper is theoretically based mainly on the research of Bayoumi and Eichengreen (1997), and Horváth and Komárek (2003). Selection and calculation of variables precedes the econometric analysis, and those variables correspond to the basic characteristics of an optimum currency area. Although the estimated model fulfills the conditions of economic and econometric verifications, its explanatory capabilities are significantly reduced due to the limited set of input data. Results of the analysis point to relatively stable values of indices in the period, but their further examination of the development in time reveals a steady deterioration in the case of almost all economies. That means that the convergence process was not proven because a decrease in OCA indexes values over the time was not observed. According to the results of comparison, methodological approach of the OCA indexes cannot be considered reliable because minor differences in calculation give different outputs. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Scientific Annals of Economics and Business de Gruyter

OCA Indexes and Convergence Process in Europe

Download PDF
11 pages

Loading next page...
 
/lp/de-gruyter/oca-indexes-and-convergence-process-in-europe-cH8GPYD4Mm
Publisher
de Gruyter
Copyright
© 2017
eISSN
2501-3165
DOI
10.1515/saeb-2017-0012
Publisher site
See Article on Publisher Site

Abstract

AbstractThis paper evaluates the European monetary convergence for period 2001 and 2013. The main purpose of this contribution is the estimation of the so-called OCA index, which indicates the proximity of two economic areas. The paper is theoretically based mainly on the research of Bayoumi and Eichengreen (1997), and Horváth and Komárek (2003). Selection and calculation of variables precedes the econometric analysis, and those variables correspond to the basic characteristics of an optimum currency area. Although the estimated model fulfills the conditions of economic and econometric verifications, its explanatory capabilities are significantly reduced due to the limited set of input data. Results of the analysis point to relatively stable values of indices in the period, but their further examination of the development in time reveals a steady deterioration in the case of almost all economies. That means that the convergence process was not proven because a decrease in OCA indexes values over the time was not observed. According to the results of comparison, methodological approach of the OCA indexes cannot be considered reliable because minor differences in calculation give different outputs.

Journal

Scientific Annals of Economics and Business – de Gruyter

Published: Jun 27, 2017

References

  • The Standard Approach : The theory of Optimum Currency Areas Prospects for monetary cooperation and integration in East Asia Massachusetts Institute of Technology
    Volz
  • Troubles in the Euro Area Periphery : The View through the Lens of a Simple Convergence Sensitive Optimum Currency Area Index Finance a úvěr
    Skořepa
  • The Endogeneity of the Optimum Currency Area Criteria Trade Enlargement Discussion Paper
    Fidrmuc
  • Assessing the Endogeneity of OCA Condition in http dx org
    Vieira
  • The Endogeneity of the Optimum Currency Area Criteria Trade Enlargement Discussion Paper
    Fidrmuc
  • Na cestě do flexibilní měnový kurz Finance a úvěr
    Cincibuch
  • convergence sensitive optimum currency area index IES Working
    Skořepa
  • Kawasaki Asian currency cooperation Japan
    Ogawa
  • Testing the Feasibility of ASEAN Single Currency Comparing Optimum Currency Area and Clustering Approach Research of
    Achsani
  • Exchange rate volatility and optimum currency area : Evidence from
    Bangake
  • convergence sensitive optimum currency area index IES Working
    Skořepa
  • New Views on the Optimum Currency Area Theory : What is EMU Telling Us ECB Working paper
    Mongelli
  • Ever Closer to Heaven An Optimum - Currency - Area Index for European Countries http dx doi org
    Bayoumi
  • New Views on the Optimum Currency Area Theory : What is EMU Telling Us ECB Working paper
    Mongelli
  • The Theory of Optimum Currency Areas : An Eclectic View In Monetary Problems in the International Economy Chicago University of Chicago Press
    Kenen
  • The Theory of Optimum Currency Areas : An Eclectic View In Monetary Problems in the International Economy Chicago University of Chicago Press
    Kenen
  • Theory of Optimum Currency Areas
    Mundell
  • Optimum Currency Areas The
    McKinnon
  • Exchange rate volatility and optimum currency area : Evidence from
    Bangake
  • Ever Closer to Heaven An Optimum - Currency - Area Index for European Countries http dx doi org
    Bayoumi
  • Optimum currency area indices evidence from the economic research papers
    Horváth
  • Kawasaki Asian currency cooperation Japan
    Ogawa
  • Na cestě do flexibilní měnový kurz Finance a úvěr
    Cincibuch
  • Troubles in the Euro Area Periphery : The View through the Lens of a Simple Convergence Sensitive Optimum Currency Area Index Finance a úvěr
    Skořepa
  • Theory of Optimum Currency Areas
    Mundell
  • Optimum Currency Areas The
    McKinnon
  • Assessing the Endogeneity of OCA Condition in http dx org
    Vieira
  • The Standard Approach : The theory of Optimum Currency Areas Prospects for monetary cooperation and integration in East Asia Massachusetts Institute of Technology
    Volz
  • Optimum currency area indices evidence from the economic research papers
    Horváth
  • Testing the Feasibility of ASEAN Single Currency Comparing Optimum Currency Area and Clustering Approach Research of
    Achsani