Currency Unions and Regional Trade Agreements: Emu and EU Effects on Trade

16 Pages Posted: 24 Apr 2018

See all articles by Reuven Glick

Reuven Glick

Federal Reserve Bank of San Francisco - Center for Pacific Basin Monetary & Economic Studies

Date Written: February 2017

Abstract

The effects of the European Economic and Monetary Union (EMU) and European Union (EU) on trade are separately estimated using an empirical gravity model. Employing a panel approach with both time-varying country and dyadic fixed effects on a large span of data (across both countries and time), it is found that EMU and EU each significantly boosted exports. EMU expanded European trade by 40% for the original members, while the EU increased trade by almost 70%. Newer members have experienced even higher trade as a result of joining the EU, but more time is necessary to see the effects of their joining EMU.

Keywords: gravity, exports, trade, bilateral, fixed, time-varying, country, currency union, monetary union, agreement, regional, European

Suggested Citation

Glick, Reuven, Currency Unions and Regional Trade Agreements: Emu and EU Effects on Trade (February 2017). Comparative Economic Studies, Vol. 59, Issue 2, 2017. Available at SSRN: https://ssrn.com/abstract=3161548 or http://dx.doi.org/10.1057/s41294-017-0020-x

Reuven Glick (Contact Author)

Federal Reserve Bank of San Francisco - Center for Pacific Basin Monetary & Economic Studies ( email )

101 Market Street
San Francisco, CA 94105
United States
415-974-3184 (Phone)
415-974-2168 (Fax)

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