The nonlinear impact of currency unions on bilateral trade

Hajime Katayama; Mark Melatos

doi:10.1016/j.econlet.2011.03.022

The nonlinear impact of currency unions on bilateral trade

Hajime Katayama^*, Mark Melatos

^*Corresponding author for this work

School of Commerce

Research output: Contribution to journal › Article › peer-review

5 Citations (Scopus)

Abstract

Most gravity model specifications assume that a currency union varies the level of bilateral trade between members by a constant proportion. We demonstrate that a common currency also alters the slope of the relationship between bilateral trade and member country GDPs.

Original language	English
Pages (from-to)	94-96
Number of pages	3
Journal	Economics Letters
Volume	112
Issue number	1
DOIs	https://doi.org/10.1016/j.econlet.2011.03.022
Publication status	Published - 2011 Jul

Keywords

Common currency
Currency union
Gravity model

ASJC Scopus subject areas

Finance
Economics and Econometrics

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10.1016/j.econlet.2011.03.022

Cite this

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title = "The nonlinear impact of currency unions on bilateral trade",

abstract = "Most gravity model specifications assume that a currency union varies the level of bilateral trade between members by a constant proportion. We demonstrate that a common currency also alters the slope of the relationship between bilateral trade and member country GDPs.",

keywords = "Common currency, Currency union, Gravity model",

author = "Hajime Katayama and Mark Melatos",

note = "Funding Information: Melatos gratefully acknowledges financial support from the Australian Research Council. ",

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N2 - Most gravity model specifications assume that a currency union varies the level of bilateral trade between members by a constant proportion. We demonstrate that a common currency also alters the slope of the relationship between bilateral trade and member country GDPs.

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KW - Common currency

KW - Currency union

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The nonlinear impact of currency unions on bilateral trade

Abstract

Keywords

ASJC Scopus subject areas

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