The dynamics of core and periphery in the European monetary union: a new approach

Campos, Nauro F. and Macchiarelli, Corrado (2021) The dynamics of core and periphery in the European monetary union: a new approach. Journal of International Money and Finance, 112. ISSN 0261-5606

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Abstract

Despite numerous studies about core-periphery in monetary unions, few focus on their dynamics. This paper (i) presents new theory-based, continuous and dynamic measures of the probability of a country being classified as core or periphery; (ii) estimates the determinants of the changes in this probability over time and across countries; and (iii) uses the Phillips-Sul convergence panel framework to investigate the behaviour of core and periphery groups over time. Our main results indicate that the post-EMU decrease of the core-periphery gap that we document was mainly driven by the adoption of the euro and by increasing competition (lower mark-ups).

Item Type:	Article
Official URL:	https://www.sciencedirect.com/journal/journal-of-i...
Additional Information:	© 2020 The Authors
Divisions:	European Institute
Subjects:	H Social Sciences > HG Finance H Social Sciences > HB Economic Theory J Political Science > JN Political institutions (Europe)
JEL classification:	C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C50 - General E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E30 - General N - Economic History > N1 - Macroeconomics and Monetary Economics; Growth and Fluctuations > N10 - General, International, or Comparative F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F40 - General
Date Deposited:	13 Jan 2022 12:57
Last Modified:	17 Apr 2024 18:36
URI:	http://eprints.lse.ac.uk/id/eprint/113423

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