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The Introduction of the Euro in Central and Eastern European Countries – Is it Economically Justifiable?

Tanja Broz

Fulltext: english, pdf (198 KB) pages 5-28 downloads: 579* cite
APA 6th Edition
Broz, T. (2008). The Introduction of the Euro in Central and Eastern European Countries – Is it Economically Justifiable?. Radni materijali EIZ-a, (1), 5-28. Retrieved from https://hrcak.srce.hr/71596
MLA 8th Edition
Broz, Tanja. "The Introduction of the Euro in Central and Eastern European Countries – Is it Economically Justifiable?." Radni materijali EIZ-a, vol. , no. 1, 2008, pp. 5-28. https://hrcak.srce.hr/71596. Accessed 22 Sep. 2021.
Chicago 17th Edition
Broz, Tanja. "The Introduction of the Euro in Central and Eastern European Countries – Is it Economically Justifiable?." Radni materijali EIZ-a , no. 1 (2008): 5-28. https://hrcak.srce.hr/71596
Harvard
Broz, T. (2008). 'The Introduction of the Euro in Central and Eastern European Countries – Is it Economically Justifiable?', Radni materijali EIZ-a, (1), pp. 5-28. Available at: https://hrcak.srce.hr/71596 (Accessed 22 September 2021)
Vancouver
Broz T. The Introduction of the Euro in Central and Eastern European Countries – Is it Economically Justifiable?. Radni materijali EIZ-a [Internet]. 2008 [cited 2021 September 22];(1):5-28. Available from: https://hrcak.srce.hr/71596
IEEE
T. Broz, "The Introduction of the Euro in Central and Eastern European Countries – Is it Economically Justifiable?", Radni materijali EIZ-a, vol., no. 1, pp. 5-28, 2008. [Online]. Available: https://hrcak.srce.hr/71596. [Accessed: 22 September 2021]

Abstracts
This paper aims to analyse the correlation of demand and supply shocks between the EMU and CEECs in order to examine whether there is some degree of business cycle coordination between them. The main objective is to investigate the impact on Croatia and compare it with other CEECs. Croatia is of interest in this paper since there is a lack of empirical studies on this topic which include Croatia in the sample. Information on the correlation of demand and supply shocks between the EMU and CEECs is important if a country wants to introduce the euro since the synchronisation of business cycles and policy coordination will have a significant impact on willingness to enter the monetary union (except if the decision is a political one). Since Croatia has started its path towards the EU, it should be expected that it will introduce the euro, since there is no opt-out clause for new members. In order to gather results, supply and demand shocks are extracted from data using Blanchard and Quah (1989) methodology and then the correlations of shocks between the EMU and CEECs are calculated as well as the size of shocks and the speed of adjustments. Results indicate that Croatia is, at the moment, far from being ready for the common monetary policy with the EMU; while other CEE countries such as Slovenia and Latvia, which in fact first applied for the introduction of euro, have the closest correlation of their business cycles with those of the EMU.

Keywords
supply and demand shocks; European Monetary Union; Central and Eastern European countries

Hrčak ID: 71596

URI
https://hrcak.srce.hr/71596

[croatian]

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