Inflation and Unemployment, new insights during the EMU accession

Jean-Louis Combes and Pierre Lesuisse ()
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Pierre Lesuisse: CERDI - Centre d'Études et de Recherches sur le Développement International - IRD - Institut de Recherche pour le Développement - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne

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Abstract: In the process of EU integration, toward the EA accession, we try to understand, how changes in exchange rate regime, attributed to the switch through the ERM-II and to the EA accession, influence the dynamic between inflation and unemployment, i.e., shock on the Phillips curve coefficient. We look at a panel of countries, in the CEECs over the last twenty years, using a recent work from McLeay and Tenreyro (2020), to clarify the impact of loosing the monetary autonomy. Being under a pegged regime is not associated with a flattened Phillips curve. However, after the EA accession, the Phillips curve coefficient becomes not significant. This result is confirmed, looking at other small EA countries; while "economic leaders" tend to maintain a significant trade-off between inflation and unemployment. Using recent work from

Keywords: Phillips curve; European Monetary Union; Panel (search for similar items in EconPapers)
Date: 2021-06-10
New Economics Papers: this item is included in nep-cba, nep-eec, nep-mac and nep-mon
Note: View the original document on HAL open archive server: https://hal.science/hal-03216478v2
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Related works:
Journal Article: Inflation and unemployment, new insights during the EMU accession (2022)
Journal Article: Inflation and unemployment, new insights during the EMU accession (2022)
Working Paper: Inflation and unemployment, new insights during the EMU accession (2022)
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