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Czech Republic and the optimum currency area criteria
Kadlecová, Pavlína ; Plchová, Božena (advisor) ; Kopecký, Jan (referee)
The goal of this bachelor thesis is to use the theory of optimum currency area to assess whether the Czech Republic is prepared to enter the Eurozone. Comparing the costs and benefits of monetary integration, this theory establishes economic and political criteria that should be met by the participating countries in order to assure that giving up the possibility to devaluate currency is still beneficial. In terms of labor mobility, the Czech Republic is far behind the Eurozone's average, but the future prospects remain positive. The degree of production diversification does not speak in favour of an early adoption of the euro either. Czech industry is too dependent on the machinery sector, which translates into a significant risk of asymmetric shocks. On the other hand, the Czech Republic performs better than most euro countries with regard to the degree of economic openness. Strong business links with Germany reduce the effectiveness of currency devaluation, making the Czech Republic a good candidate to enter the EMU. For such ambiguous cases, the theory recommends creating a system of fiscal transfers, which would allow countries to compensate for the negative effects of economic shocks. Consequently, the best approach for the Czech Republic seems to be achieving stronger real convergence and deeper political integration.
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Fiscal compact
Suková, Nikol ; Ježek, Tomáš (advisor) ; Chmelová, Pavla (referee)
The thesis evaluates a need of the Fiscal compact measures, its adequacy and impacts on the Eurozone namely based on evaluation of indebtedness of selected member states. The evaluation is carried out by the empirical-analytic research, where the euro zone is analyzed from the perspective of the theory of optimal monetary area, the issue of member countries indebtedness and impacts of indebtedness on the entire euro zone. The thesis also evaluates the existing instruments of fiscal discipline and their deficiencies and new Fiscal compact as an instrument for stabilization and correction. The thesis examines the accuracy of the initial hypothesis that the Fiscal compact as an instrument of fiscal discipline is entirely essential measure of the future euro area functioning. It had been proven that a monetary union can not effectively operate without the long-term fiscal union.
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Hospodářský cyklus vybraných zemí EU. Může se EU stát optimální měnovou oblastí?
Najman, Nikola
This dissertation is based on the perspective of the new theory of optimum currency areas (OCA) and the coherence of business cycles is considered as a prerequisite for creating monetary union. The OCA theory is applied both to the EU countries and US states and census regions. Measuring the coherence of business cycles was performed using a composite indicator, which consists of business cycles synchronicity and similarity indices. Cluster analysis was performed to identify groups of countries with similar characteristics of business cycles.
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Analysis of real convergence of selected new member countries of the Eurozone
Polakovič, Martin ; Vostrovská, Zdenka (advisor) ; Misic, Viktorija (referee)
This diploma thesis deals with the problem of real convergence of new member countries of the Eurozone. Development in recent years in Europe has clearly shown that monetary union is suitable only for homogenous group of countries. The main aim of the thesis is to analyze the progress of convergence in Slovakia, Slovenia and Estonia after the year 2000 and answer the question which country was best prepared to join the monetary union. Used method of investigation is analysis of historical time series and regression analysis. Main conclusion of the thesis is that highest level of convergence was achieved in Slovenia, but the country with lowest cost of joining Eurozone was Estonia. In final part of the thesis is presented own forecast of future development of real convergence until the year 2030. Theoretical background of the prognosis is based on Solow's growth model and resulting theory of convergence.
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The impact of the debt crisis on monetary integration in Europe
Pecho, Maroš ; Čajka, Radek (advisor) ; Hinčica, Vít (referee)
The bureaucratic structures of European Union, Eurozone etc.; deal with the issue of monetary integration these days. This point was achieved, because of the beginning of debt crisis, which has erupted in 2009. In this thesis is a clear explanation of monetary integration in general, hers costs and benefits and also historical development within the framework of monetary union in Europe. The emphasis is placed on creation reasons of debt crisis, with detailed description and interpretation of the global imbalances principle, applied on Eurozone members. In the part discussing global imbalances are stated PIIGS states and their main task within the framework of debt crisis. The most important part is the part, noticing the concrete steps in European integration deepening such as formation of stability mechanisms -- EFSM, EFSF, ESM; continues to preparation of formation named as bank union; introduction of financial transaction tax etc. The might and theoretical solutions, like Eurobonds or disintegration of Eurozone, are also included. The last paragraph sums up impact of debt crisis on integration processes.
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The theory of optimum currency areas and the entry of the Czech Republic into the EMU
Vála, Vladimír ; Koderová, Jitka (advisor) ; Kučera, Lukáš (referee)
The aim of this bachelor thesis is to determine, whether the Economic and Monetary Union fulfills criteria of optimum currency area, to evaluate the nominal and real convergence of the Czech Republic to EMU and to assess benefits and costs resulting from the implementation of common currency in the Czech Republic. I present basic criteria of optimum currency area and I try to find out whether they are met within the EMU. There are three economic criteria, three political criteria, the criteria of alignment of the business cycle, and also to mention Brown's tests and criteria of Václav Klaus. It also analyses whether the Czech Republic meets the Maastricht (nominal) convergence criteria and the extent to which is achieved real convergence. The benefits and costs associated with membership in the European Monetary Union for the Czech Republic are described in the conclusion.
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NORTH VS. SOUTH OF THE EURO AREA IN TERMS OF OCA
Hlavová, Kristýna ; Dočkal, Dalibor (advisor) ; Urban, Luděk (referee)
This study divides the eurozone countries into two groups, the first group is "North states" and the second "South states". These two parts are mutually compared and evaluated in terms of the optimum currency area (OCA) theory. The beginning of this work introduces the basic concepts and the history of the OCA theory and the euro area. The theoretical part focuses on the definition and explanation the OCA criteria. The eurozone will be evaluated in terms of fulfillment or non-fulfillment of these criteria. The main aim of this work will be to decide which of these two parts of the euro area to a greater extent fulfills OCA criteria and which of them has a greater potential to become an optimum currency area in the future. The analysis will be based on the available statistical data.
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Dynamics of monetary integration with a focus on EMU
Kříž, Karel ; Mládek, Josef (advisor) ; Urban, Luděk (referee)
In context of recent development in the euro area it is obvious that the status quo is unsustainable and it is necessary to execute certain measures which would ensure its functioning in the future. The aim of this thesis is to find out the most appropriate solution for the European Union as a whole. Thesis presents and compares the three most likely scenarios for future development. A brief overview of the development of European integration, the concept of optimum currency area with the criteria for its better functioning and examples of other monetary unions with the threats they could possibly face are included for better understanding of the issue.
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The eurozone in the historical context
Hankeová, Lucie ; Pavlík, Zdeněk (advisor) ; Froňková, Martina (referee)
This thesis analyzes the current situation of the eurozone in terms of historical development, and searches for causes of problems in the decisions made during the initial stages of economic and monetary integration. Formation of the European Monetary Union is examined in detail from the inception of the European Monetary System, and until the introduction of the single currency in 2002. Attention is drawn to the fundamental divergence between some members during the formation of the Union, which leads to the significant bipolarity. Uniformity, or rather non-uniformity of the eurozone, is at first evaluated on the basis of the nominal convergence criteria, then according to the theory of optimum currency areas. The conclusion outlines three scenarios according to which the future of the euro area can be built.
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