{
  "title": "Capital Markets and External Current Accounts: What to Expect From the Euro",
  "publication": "IMF Working Papers, August 1, 2000",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/30/capital-markets-and-external-current-accounts-what-to-expect-from-the-euro-3838",
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  "summary": "The paper compares the degree of capital market integration across euro-area countries with that across regions in Italy and provinces in Canada.",
  "sections": [
    {
      "heading": "Summary findings",
      "content": "- The paper compares the degree of capital market integration across euro-area countries with that across regions in Italy and provinces in Canada.\n- Analyses of saving-investment correlations, and a model of capital flows developed and fitted to the data, reveal no compelling differences between the integration across countries before monetary union and that across the regions or provinces.\n- The evidence does not suggest that EMU will prompt a major reallocation of net capital flows within the euro area that would entail sizable shifts in countries’ equilibrium current accounts."
    },
    {
      "heading": "Methodology and analysis",
      "content": "- Empirical analysis of saving-investment correlations across:\n  - euro-area countries (pre-monetary union)\n  - regions in Italy\n  - provinces in Canada\n- Development and calibration/estimation of a model of capital flows fitted to the data to assess potential reallocations induced by monetary union."
    },
    {
      "heading": "Conclusions and policy implications",
      "content": "- No compelling empirical or model-based evidence that monetary union (EMU) will cause major reallocation of net capital flows among euro-area countries.\n- Accordingly, sizable shifts in countries’ equilibrium current accounts within the euro area are not indicated by the study’s findings."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subjects: Balance of payments, Capital market integration, Capital markets, Current account, Economic integration, Financial markets, Financial services, Production, Productivity, Real interest rates\n- Keywords: capital market, Capital market integration, Capital markets, capital mobility, Current account, current account response, EMU, Euro area, Global, investment, investment response, Productivity, productivity shock, Real interest rates, regions, saving, saving-investment correlation, WP\n\nContent summarized from the IMF Working Paper landing page: \"Capital Markets and External Current Accounts: What to Expect From the Euro\", Jörg Decressin and Piti Disyatat, August 1, 2000.\n\n---\n\n Content in this bundle\n\n- Capital Markets and External Current Accounts: What to Expect from the Euro - WP/00/154\n  - Capital Markets and External Current Accounts: What to Expect from the Euro - WP/00/154 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Capital Markets and External Current Accounts: What to Expect from the Euro - WP/00/154 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/capital-markets-and-external-current-accounts-what-to-expect-from-the-euro-3838"
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    "Authors: Jörg Decressin, Piti Disyatat",
    "Published: August 1, 2000",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451857221.001",
    "The paper compares the degree of capital market integration across euro-area countries with that across regions in Italy and provinces in Canada.",
    "Analyses of saving-investment correlations, and a model of capital flows developed and fitted to the data, reveal no compelling differences between the integration across countries before monetary union and that across the regions or provinces.",
    "The evidence does not suggest that EMU will prompt a major reallocation of net capital flows within the euro area that would entail sizable shifts in countries’ equilibrium current accounts.",
    "Empirical analysis of saving-investment correlations across:",
    "Development and calibration/estimation of a model of capital flows fitted to the data to assess potential reallocations induced by monetary union.",
    "No compelling empirical or model-based evidence that monetary union (EMU) will cause major reallocation of net capital flows among euro-area countries.",
    "Accordingly, sizable shifts in countries’ equilibrium current accounts within the euro area are not indicated by the study’s findings.",
    "Subjects: Balance of payments, Capital market integration, Capital markets, Current account, Economic integration, Financial markets, Financial services, Production, Productivity, Real interest rates",
    "Keywords: capital market, Capital market integration, Capital markets, capital mobility, Current account, current account response, EMU, Euro area, Global, investment, investment response, Productivity, productivity shock, Real interest rates, regions, saving, saving-investment correlation, WP",
    "**Capital Markets and External Current Accounts: What to Expect from the Euro - WP/00/154**"
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