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Podobnosť ponukových a dopytových šokov v Európskej Únii a v pristupujúcich krajinách (implikácie pre Českú republiku a Slovensko)
[Similarity of supply and demand shocks in the European Union and acceding countries (implications for the Czech republic and Slovakia)]

Author

Listed:
  • Jarko Fidrmuc
  • Eduard Hagara

Abstract

In this contribution, we compare the correlation of supply and demand shocks for the countries of the euro zone and the acceding countries in Central Europe. Demand and supply shocks are recovered from estimated structural VAR models of output growth and inflation in individual countries. We find that Poland and Hungary face already a comparably high similarity with the countries of the current euro zone. However, the remaining countries show still significant differences in business cycles as compared to the euro zone. This is likely to indicate that the loss of monetary sovereignty may be costly. In turn, the integration is expected to align the business cycles of these countries in the medium run. We document a similar development for the countries of the European Union in the 1990s.

Suggested Citation

  • Jarko Fidrmuc & Eduard Hagara, 2004. "Podobnosť ponukových a dopytových šokov v Európskej Únii a v pristupujúcich krajinách (implikácie pre Českú republiku a Slovensko) [Similarity of supply and demand shocks in the European Union and ," Politická ekonomie, Prague University of Economics and Business, vol. 2004(2), pages 153-164.
    • Handle: RePEc:prg:jnlpol:v:2004:y:2004:i:2:id:455
    DOI: 10.18267/j.polek.455
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    1. Iikka Korhonen, 2003. "Some empirical tests on the integration of economic activity between the euro area and the accession countries," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 11(1), pages 177-196, March.
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    5. Frenkel, Michael & Nickel, Christiane & Schmidt, Günter, 1999. "Some shocking aspects of EMU enlargement," Research Notes 99-4, Deutsche Bank Research.
    6. Fidrmuc, Jan & Horvath, Julius & Fidrmuc, Jarko, 1999. "The Stability of Monetary Unions: Lessons from the Breakup of Czechoslovakia," Journal of Comparative Economics, Elsevier, vol. 27(4), pages 753-781, December.
    7. Lubos Komarek & Zdenek Cech & Roman Horvath, 2003. "Optimum Currency Area Indices - How Close is the Czech Republic to the Eurozone?," Working Papers 2003/10, Czech National Bank.
    8. Boone, Laurence & Maurel, Mathilde, 1999. "An Optimal Currency Area Perspective of the EU Enlargement to the CEECs," CEPR Discussion Papers 2119, C.E.P.R. Discussion Papers.
    9. Fidrmuc, Jarko & Korhonen, Iikka, 2003. "Similarity of supply and demand shocks between the euro area and the CEECs," Economic Systems, Elsevier, vol. 27(3), pages 313-334, September.
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    More about this item

    Keywords

    optimum currency area; EU enlargement; structural VAR;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission

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