Abstract
We investigate the integration of euro-zone retail banking markets by comparing convergence and cointegration measures. As an innovation to the literature convergence measures are exposed to a difference-in-differences methodology which allows both, identifying the impact of the single currency and benchmarking euro zone-specific from global integration effects. We find that euro-zone convergence has largely been a result of integrating wholesale markets after the elimination of exchange rate risks. After 1999 integration is mainly observed for a restricted “convergence club” excluding germany, ireland and belgium. Moreover, convergence is at least partly a global rather than euro zone-specific process.
Original language | English |
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Pages (from-to) | 353-368 |
Number of pages | 16 |
Journal | Quarterly Review of Economics and Finance |
Volume | 46 |
Issue number | 3 |
DOIs | |
Publication status | Published - 1 Jan 2006 |