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Producer Prices in the Transition to a Common Currency

Author

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  • Andrén, Niclas

    (Institute of Economic Research)

  • Oxelheim, Lars

    (Research Institute of Industrial Economics)

Abstract

We analyze producer price developments in the transition from a national exchange rate regime to a monetary union. The focus is on the European Economic and Monetary Union (EMU). Stylized facts witness about an exploding gaps in producer-price inflation during the years immediately following the completion of the EMU. Price convergence is found to be an important driver throughout the entire euro period (1999-2005), but with no significant differences in speed compared to the pre euro period. Productivity growth had its primary effect in the first years and effective exchange-rate changes in the later years of the euro period.

Suggested Citation

  • Andrén, Niclas & Oxelheim, Lars, 2006. "Producer Prices in the Transition to a Common Currency," Working Paper Series 668, Research Institute of Industrial Economics.
    • Handle: RePEc:hhs:iuiwop:0668
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    2. Ekaterina Dyachenko, 2013. "Internationalization of academic journals: is there still a gap between social and natural sciences?," HSE Working papers WP BRP 28/HUM/2013, National Research University Higher School of Economics.

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    More about this item

    Keywords

    Producer prices; Relative prices; Price convergence; Euro; Balassa-Samuelson;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • F15 - International Economics - - Trade - - - Economic Integration
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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