DP6254 Checking Out: Exits from Currency Unions
|Author(s):||Andrew K Rose|
|Publication Date:||April 2007|
|Keyword(s):||country, data, empirical, monetary, panel, probit, statistic|
|Programme Areas:||International Macroeconomics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=6254|
This paper studies the characteristics of departures from monetary unions. During the post-war period, almost seventy distinct countries or territories have left a currency union, while over sixty have remained continuously in currency unions. I compare countries leaving currency unions to those remaining within them, and find that leavers tend to be larger, richer, and more democratic; they also tend to have higher inflation. However, there are typically no sharp macroeconomic movements before, during, or after exits.