01869cas a2200253 a 4500 AALejournalIMF019187 230101c9999 xx r poo 0 0eng d 5.00 USD 9781498311489 1018-5941 BD-DhAAL BD-DhAAL Abbritti, Mirko. Market Regulation, Cycles and Growth in a Monetary Union / Mirko Abbritti, Sebastian Weber. Washington, D.C. : International Monetary Fund, 2019. 1 online resource (52 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students We build a two-country currency union DSGE model with endogenous growth to assess the role of cross-country differences in product and labor market regulations for long-term growth and for the adjustment to shocks. We show that with endogenous growth, there is no reason to expect real income convergence. Large shocks, through endogenous TFP movements, can lead to permanent changes of output and real exchange rates. Differences are exacerbated when member countries have different product and labor market regulations. Less regulated economies are likely to have higher trend growth and recover faster from negative shocks. Results are consistent with higher inflation, lower employment and disappointing TFP growth rates experienced in the less reform-friendly euro area members. Mode of access: Internet Weber, Sebastian. IMF Working Papers; Working Paper ; No. 2019/123 Full text available on IMF http://elibrary.imf.org/view/journals/001/2019/123/001.2019.issue-123-en.xml IMF e-Library