Currency blocs in the 21st century
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Title:
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Currency blocs in the 21st century |
Author:
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Fischer, Christoph
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Organization:
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Bank of Finland
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Department / Unit:
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Institute for Economies in Transition (BOFIT)
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Series:
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BOFIT Discussion Papers
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Series number:
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24/2012 |
Year of publication:
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2012 |
Publication date:
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15.10.2012 |
Pages:
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57 s. |
Keywords:
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valuuttakurssit; valuutat; euro; kansainvälinen; Bofit-kokoelma; USD; käyttö; valuutta-alueet
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JEL:
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F02; F31; F33; E42; C25
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Abstract:
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Based on a classification of countries and territories according to their regime and anchor currency choice, the study considers the two major currency blocs of the present world. A nested logit regression suggests that long-term structural economic variables determine a given country's currency bloc affiliation. The dollar bloc differs from the euro bloc in that there exists a group of countries that peg temporarily to the US dollar without having close economic affinities with the bloc. The estimated parameters are consistent with an additive random utility model interpretation. A currency bloc equilibrium in the spirit of Alesina and Barro (2002) is derived empirically. Keywords: anchor currency choice, nested logit, exchange rate regime classification, additive random utility model, currency bloc equilibrium JEL-Classification: F02, F31, F33, E42, C25 |
Rights:
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https://helda.helsinki.fi/bof/copyright
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