V Convergence Issues
Author: Mr. Mark P. Taylor1, Mr. Peter Isard, Mr. Morris Goldstein2, and Mr. Paul R Masson
  • 1 0000000404811396https://isni.org/isni/0000000404811396International Monetary Fund
  • | 2 0000000404811396https://isni.org/isni/0000000404811396International Monetary Fund
Language:
English
Keywords:
OP; monetary union desirable; monetary union; country; exchange rate commitment; policy union; policy coordination; exchange rate union; Monetary unions; Exchange rates; Currencies; Real exchange rates; Europe; Middle East; Western Hemisphere; Asia and Pacific; Global; unemployment hysteresis; factor price; inflation convergence; output equalization; formation of monetary unions; Price stabilization; Inflation

Abstract

Issues of real and nominal economic convergence are central to any discussion of the formation of monetary unions.59 On the one hand, it is perhaps intuitively obvious that monetary union implies convergence of inflation rates—at least in the long run. Indeed, convergence of both inflation rates and monetary policy has been a feature of the EMS, particularly since 1982; see Chart 3.60 On the other hand, it is not clear whether real convergence is a prerequisite or a consequence of closer economic integration.

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Cover Policy Issues in the Evolving International Monetary System
Policy Issues in the Evolving International Monetary System
Author: Mr. Mark P. Taylor, Mr. Peter Isard, Mr. Morris Goldstein, and Mr. Paul R Masson
ISBN:
9781557752345
ISSN:
0251-6365
Publication Date:
15 Jun 1992
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781557752345.084
Pages:
81