The customs union argument for a monetary union
Journal of Banking & Finance p. 877- 887
If the real exchange rate follows approximately a random walk and in the presence of nontraded goods, a monetary union may generate a Pareto improvement. The argument is based on the analogy with the advantages that derive from the formation of a customs union. A novel unit roots test based on the arc sine law is advanced.
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|Journal of Banking & Finance|
|Organisation||Erasmus School of Economics|
van Marrewijk, J.G.M, & de Vries, C.G. (1990). The customs union argument for a monetary union. Journal of Banking & Finance, 877–887. doi:10.1016/0378-4266(90)90018-W