Balkan and Mediterranean Candidates for European Union Membership: The Convergence of Their Monetary Policy with that of the European Central Bank

15 Pages Posted: 15 Nov 2001

See all articles by Josef C. Brada

Josef C. Brada

Arizona State University (ASU) - Economics Department

Ali M. Kutan

Southern Illinois University at Edwardsville

Date Written: April 2002

Abstract

We compare the convergence with German monetary policy of the Balkan and Mediterranean country candidates for EU membership with that of countries that have recently joined the EU. Significant linkages exist between German base money stock and that of recent members of the EU; the same holds true for some of the Mediterranean region candidates for EU membership and for Slovenia and Croatia. Among the other Balkan economies and Turkey, the ability to follow the policies of the Bundesbank is nonexistent. Such weak policy coordination suggests the need for strengthening the financial sectors of these countries, for macroeconomic stabilization and for a period in which they tie their policies more closely to the ECB before they can be considered serious candidates for EU membership.

Keywords: convergence, economic integration, monetary policy, transition economies, Balkans

JEL Classification: E58, F15, F36, P52

Suggested Citation

Brada, Josef C. and Kutan, Ali M., Balkan and Mediterranean Candidates for European Union Membership: The Convergence of Their Monetary Policy with that of the European Central Bank (April 2002). Available at SSRN: https://ssrn.com/abstract=290922 or http://dx.doi.org/10.2139/ssrn.290922

Josef C. Brada

Arizona State University (ASU) - Economics Department ( email )

Box 873806
Tempe, AZ 85287-3806
United States
602-965-6524 (Phone)
602-965-0748 (Fax)

HOME PAGE: http://www.mesharpe.com/eee_main.htm

Ali M. Kutan (Contact Author)

Southern Illinois University at Edwardsville ( email )

Department of Economics and Finance AH-3141
Edwardsville, IL 62026-1102
United States
618-650-3473 (Phone)
618-650-3047 (Fax)

HOME PAGE: http://https://ideas.repec.org/e/pku30.html