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Macroeconomic effects of the European Monetary Union: a counterfactual analysis

Faculty Advisor




Monetary Union, Euro, growth, Greece, counterfactual

Abstract (summary)

This is an empirical study on the effects of adopting a common currency, the euro, on a country’s GDP, inflation rate, and public debt. It uses a synthetic counterfactual method, which predicts how the economy of a euro area member country would perform if, hypothetically, the country did not join the euro area. The results show that there is no generally positive or negative effect of using a common currency, but individual countries fare differently in different periods. A novelty in this paper is determining confidence intervals in the counterfactual method. Some examples concern Greece

Publication Information

Colonescu, C. (2017). "Macroeconomic effects of the European Monetary Union: A counterfactual analysis." Athens Journal of Business and Economics, 3 (2), 171-186. Retrieved from



Presented on June 3-5, 2016 at the Canadian Economics Association Annual Conference held in Ottawa, Ontario, and on May 4-5, 2017 at the Alberta Mathematics Dialogue conference held in Edmonton, Alberta.

Item Type





Attribution-NonCommercial (CC BY-NC)