LINKS BETWEEN REAL AND NOMINAL CONVERGENCE IN THE NEW EU MEMBER STATES: IMPLICATIONS FOR THE ADOPTION OF EURO

• Authors: Vintrova R. , Zdarek V.
• Languages of publication: EN

Abstracts

EN

This paper analyses the relationships between real and nominal convergence in the new post communist member states and on this basis evaluates the potential benefits and risks connected with joining the euro. The analysis observes both the common problems of catching-up economies and the dissimilarities and peculiarities influenced by the differences in the macroeconomic parameters in individual countries. The regression analysis shows interdependence between the comparative price and wage level and the income per capita level. The benefits connected with elimination of the exchange rate risks and reduction of transaction costs are compared with the disadvantages associated with the loss of an independent monetary policy and an adjusting exchange rate mechanism. Attention is paid to a potential impact on real convergence of the observed countries.

Keywords

EN

INCOME PER CAPITA LEVEL; NOMINAL CONVERGENCE; PRICE AND WAGE LEVEL; REAL CONVERGENCE

Discipline

• ECONOMICS: ECONOMICS

• Publisher: Institute of Slovak and World Economics and Institute for Forecasting, Slovak Academy of Sciences
• Journal: Ekonomický časopis (Journal of Economics)
• Year: 2007
• Volume: 55
• Issue: 5
• Pages: 439-458
• Document type: ARTICLE

Contributors

author

Vintrova R.

author

Zdarek V.

• R. Vintrova, Ekonomicky ustav SAV, Sancova 56, 811 05 Bratislava 1, Slovak Republic

Identifiers

CEJSH db identifier

07SKAAAA03006165