Search

This paper evaluates new evidence on price-setting practices and inflation persistence in the euro area with respect to its implications for macro modeling. It argues that several of the most commonly used assumptions in micro-founded macro models are seriously challenged by the new findings. [ABSTRACT FROM AUTHOR]

This paper examines the impacts of the Euro adoption in Slovenia on its tourism. For this purpose, the empirical research among foreign tourists in Slovenia was conducted on their perceptions of the Euro adoption in Slovenia during the second half of 2007. The multivariate factor analysis was performed, which confirmed the four common dimensions of the Euro impacts on Slovenian tourism: attractiveness, costs, expensiveness, and comparison. The mean values of the analyzed items indicate the most positive impacts of the Euro on the direct price comparison and the easiness of comparison among tourist destinations in the Euro zone. The empirical results suggest that the Euro adoption has had the greatest impacts on better comparisons among tourist destinations in the Euro zone, followed by a significant decline in travel-operational costs. The increase in the expensiveness of the destination among foreign tourists is confirmed, whereas no significant improvement in the attractiveness of Slovenia as a tourist destination was proved after the Euro adoption. [ABSTRACT FROM AUTHOR]

Currency substitution has important implications for the cost of European monetary union—if it is significant it will help to reduce costs of convergence to a single currency. This paper informs the policy debate by testing for its existence on a consistent European database making use of cointegration methods. The results demonstrate that in the two types of model tested there is no clear evidence of currency substitution, in either the short or the long run, and that therefore currency substitution between sterling and EC currencies cannot be relied upon as a mechanism or an aid to reduce the costs of monetary convergence. [ABSTRACT FROM AUTHOR]

The article discusses the appropriateness of the institutional and policy arrangements governing the European single currency. The institutional and policy arrangements governing the operations of the eurozone arise from the pursuit of a particular neoliberal agenda. Three elements stand out in the institutional framework governing the operation of the European single currency. First, the European Central Bank (ECB) is independent of the European Council and Parliament and of its member governments. Thus, there is a complete separation between the monetary authorities. Second, the ECB is the only effective federal economic institution. Third, the ECB and the national central banks are linked into the European System of Central Banks with a division of responsibility between them. A great deal more is needed if fiscal policy is to help the euro area to speedily move toward a real recovery. Under these circumstances, credibility might be enhanced rather than impaired. A "two-pillar" monetary strategy has been adopted. The first pillar is a commitment to analyze monetary developments and to adopt a quantitative reference value for monetary growth. The second pillar is a broadly based assessment of the outlook of price developments and the risks to price stability.

Responds to Benito Giordano's comments on the editorial article, 'Euroland--economic, cultural and political geographers.' Theme of heterogeneity and orientation evoked by images in the Euro bank notes; Point that European countries will not have their usual short-term economic fixes.

Comments on the article by Jane S. Pollard and James D. Sidaway, 'Editorial: Euroland--economic, cultural and political geographers,' published in the periodical 'Transactions of the Institute of British Geographers.' Symbolism of the images of seven bridges in the Euro bank notes; Impact of the European Monetary Union (EMU) on interregional economic differences.

The article presents information about the book "The Euro and the Dollar," by Robert N. McCauley. The book examines the implications of the euro for the U.S. dollar. In particular, it investigates the motives for, and implications of, shifts of funds by international portfolio managers in response to the Euro's introduction. The book considers the responses of three classes of portfolio managers, official reserve-asset managers, private asset managers, and public and private liability managers, during at least three stages of monetary union: the period before the irrevocable fixing of conversion rates between exiting European currencies and the euro; the period before the European Central Bank has consolidated its credibility; and the steady state beyond union.

Explains the currency undervaluation phenomenon in Central and Eastern Europe. Factors contributing to the initial over-devaluation; Relationship of initial relative prices and subsequent inflation rates of main commodities; Forces behind the pattern of relative price changes.