The External Dimension of the Euro Area Assessing the Linkages

Although still relatively closed, the Euro area economy is nevertheless subject to a broad range of economic impacts originating from outside its borders. This book aims to improve our understanding of how, and to what extent, such external developments affect the Euro area. Using a broad range of methodologies and techniques, the chapters analyse the various channels that connect the Euro area to its external environment; most notably trade, capital flows and other international macroeconomic linkages. The result is that the interaction between the Euro area and its 'external dimension' is shown to be more complex and extensive than had previously been thought. With contributions from both academics and professionals, this volume will be an invaluable source of information for researchers and policy-makers concerned with the interaction between regional European integration and globalization.

Preface Filippo di Mauro and Robert Anderton; 1. Introduction Filippo di Mauro and Robert Anderton; 2. The external dimension of the Euro area: stylised facts and initial findings Filippo di Mauro and Robert Anderton; 3. Product variety and macro trade models: implications for EU Accession Countries Joseph Gagnon; 4. Exchange-rate pass-through to import prices in the Euro area José Manuel Campa, Linda S. Goldberg and José M. Gonzaléz-Mínguez; 5. The international equity holdings of Euro area investors Philip R. Lane and Gian Maria Milesi-Ferretti; 6. Global linkages through foreign direct investment W. Jos Jansen and Ad C. J. Stokman; 7. Shocks and shock absorbers: the international propagation of equity market shocks and the design of appropriate policy responses Ray Barrel and E. Philip Davis; 8. The Euro area in the global economy: its sensitivity to the international environment and its influence on global developments Alessandro Calza and Stephane Dees; Index.