Monetary Regimes, Economic Stability, and EU Accession: Comparing Bulgaria and Romania

Communist and Post-Communist Studies, Vol. 46, No. 1, pp. 13-23, 2013

Posted: 7 Jul 2013

See all articles by Nikolay Nenovsky

Nikolay Nenovsky

Bulgarian National Bank

Kiril Tochkov

Texas Christian University - Department of Economics

Camelia Turcu

University of Orleans

Date Written: 2013

Abstract

This paper traces the origins of the different monetary regimes adopted in Bulgaria and Romania in 1996-97 and examines their performance during the EU accession. The findings indicate that the constraints of the currency board in Bulgaria shifted economic activity towards the private sector, while the discretionary policies in Romania turned public finances into both a contributor and a response mechanism to economic imbalances. While the prospects of EU accession initially enhanced the performance of the monetary anchors, the implicit insurance of EU membership increased moral hazard and led to a rapid rise in private and public debt. The paper also explores the historical parallels between the monetary regimes of Bulgaria and Romania in 1996-97 and 1925-1940.

Keywords: post-communist transition, monetary regimes, global crisis, Bulgaria, Romania

JEL Classification: F33, F36, P20, P30

Suggested Citation

Nenovsky, Nikolay and Tochkov, Kiril and Turcu, Camelia, Monetary Regimes, Economic Stability, and EU Accession: Comparing Bulgaria and Romania (2013). Communist and Post-Communist Studies, Vol. 46, No. 1, pp. 13-23, 2013, Available at SSRN: https://ssrn.com/abstract=2290410

Nikolay Nenovsky (Contact Author)

Bulgarian National Bank ( email )

str "St. Sofia" 5
Sofia, 1040
Bulgaria
+ 359 2 9145 1239 (Phone)
+ 359 2 980 24 25 (Fax)

Kiril Tochkov

Texas Christian University - Department of Economics ( email )

Box 298510
Fort Worth, TX 76129
United States
817-257-7554 (Phone)
817-257-5058 (Fax)

HOME PAGE: http://personal.tcu.edu/ktochkov

Camelia Turcu

University of Orleans ( email )

Rue de Blois
B.P. 6739
45067 Orleans Cedex 2, Orleans cedex 2 45067
France

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
336
PlumX Metrics