Assessing the Assessment: A Critical Look At the June 2003 Assessment of the United Kingdom'S Five Tests for Euro Entry

July 1, 2004

Preview Citation

Format: Chicago

Carlo Cottarelli, and Julio Escolano. Assessing the Assessment: A Critical Look At the June 2003 Assessment of the United Kingdom'S Five Tests for Euro Entry, (USA: International Monetary Fund, 2004) accessed December 26, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper provides a framework for evaluating the decision to enter a currency area, including the best timing for entry, and uses it to evaluate the assessment of the five tests for euro entry published by the U.K. Treasury in June 2003. The breadth and depth of its assessment is impressive by any standard. Nonetheless, this paper points at some areas that deserve to be explored further in future assessments. Covering these areas would not necessarily have changed the assessment's conclusion, namely that the case for entry is not yet "clear and unambiguous,." but it would have strengthened any conclusion reached. In addition, the paper highlights that in several areas relevant to the entry decision, the margin for uncertainty will remain significant, regardless of any reasonable attempt to reduce it.

Subject: Consumption, Economic integration, Financial institutions, Housing, Housing prices, Monetary unions, Mortgages, National accounts, Prices

Keywords: Assessing the Assessment, Consumption, Euro area, Euro Entry, Five Tests, Global, Housing, Housing prices, Monetary unions, Mortgages, Transmission mechanism, U.K. economy, U.K. government, U.K. housing cycle, U.K. idiosyncrasy, U.K. transmission mechanism, U.K. Treasury, WP

Publication Details

Pages:

46
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2004/116
Stock No:

WPIEA1162004
ISBN:

9781451853964
ISSN:

1018-5941

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