Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/76467
Authors: 
Nitsch, Volker
Year of Publication: 
2004
Series/Report no.: 
CESifo Working Paper 1113
Abstract: 
Historically, dissolutions of currency unions are not unusual. I use an annual panel data set covering 245 country pairs that use a common currency (of which 128 are dissolved) from 1948 through 1997 to characterize currency union exits. I find that departures from a currency union tend to occur when there is a large inflation differential between member countries, when the currency union involves a country which is closed to international trade and trade flows dry up, and when there is a change in the political status of a member. In general, however, macroeconomic factors have only little predictive power for currency union dissolutions.
Subjects: 
monetary union
sovereign currency
dissolution
exit
Document Type: 
Working Paper

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