Europe, Financial sector, External Publications

Structural Change and Exchange Rate Dynamics

Structural Change and Exchange Rate Dynamics. The Economics of the EU Eastern Enlargement is a book edited by Anna Wziatek-Kubiak - a CASE senior fellow, and Paul J.J. Welfens.
Structural change, economic growth, adequate exchange rate adjustment and consistent macroeconomic policies are the key challenges in the context of EU eastern enlargement - argue the authors of the book. Most papers presented in the book are from a three-year project entitled "Changes in Industrial Competitiveness as a Factor of Integration: Identifying Challenges of the Enlarged Single European Market". CASE coordinated the research project, which involved 11 European research institutes and was financed within the EU 5th Framework Programme.

The book focuses on sectoral adjustment across industries in "catch-up countries" and explains changes in the composition of output - this includes new aspects of the Chenery model. Spatial patterns of specialization and adjustment in many countries are described and analyzed. Theoretical and empirical analysis of foreign direct investment, innovation and structural change sheds new light on economic dynamics in Old Europe and New Europe. Regarding exchange rate dynamics, both traditional aspects (such as the Balassa-Samuelson effect) and new approaches to understanding exchange rate developments are presented. Links between exchange rate changes and innovation are particularly emphasized.

Detailed information on the project and its findings can be downloaded from the CASE website. More information on the volume, which is being published by Springer, is available at the publisher's website