Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper studies the nature of the shocks affecting the Eastern Caribbean Currency Union (ECCU), and examines whether a hypothetical Eastern Caribbean fiscal insurance mechanism could insure member countries of the union against asymmetric national income shocks. The empirical results suggest that a one dollar reduction in an ECCU member country's per capita personal income could trigger, through reduced income taxes and increased transfers, flows equivalent to about 7 percent of the initial income shock. Each member of the currency union could benefit as well, although the extent of shock mitigation differs across individual countries.

Fiscal policy --- Tax policy --- Taxation --- Economic policy --- Finance, Public --- Econometric models. --- Government policy --- Eastern Caribbean Currency Union --- Eastern Caribbean Currency Union. --- ECCU --- Economic policy. --- Macroeconomics --- Public Finance --- Fiscal Policy --- International Agreements and Observance --- International Organizations --- Taxation, Subsidies, and Revenue: General --- Fiscal and Monetary Policy in Development --- Personal Income, Wealth, and Their Distributions --- Aggregate Factor Income Distribution --- Public finance & taxation --- Personal income --- Income tax systems --- Revenue administration --- Income shocks --- Disposable income --- National accounts --- Taxes --- Income --- Income tax --- Revenue --- National income --- United States

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This Selected Issues paper analyzes productivity in the Eastern Caribbean Currency Union by exploring two complementary exercises. It computes total factor productivity by extending standard growth accounting frameworks with (1) the impact of natural disasters on the stock and productivity of physical capital; (2) human capital accumulation; and (3) the impact of out-migration on labor and human capital. The paper also analyzes labor productivity, including across economic sectors. The results indicate that the historical deceleration in growth was driven mostly by the declining contribution of total factor productivity, which resulted in stagnation in the aftermath of the global financial crisis. Labor productivity measures show that labor is largely allocated in the sectors with relatively lower productivity.

Macroeconomics --- Public Finance --- Production and Operations Management --- Fiscal Policy --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Human Capital --- Skills --- Occupational Choice --- Labor Productivity --- Macroeconomics: Production --- Labor Economics: General --- Public finance & taxation --- Labour --- income economics --- Fiscal rules --- Total factor productivity --- Labor productivity --- Labor --- Public debt --- Fiscal policy --- Industrial productivity --- Labor economics --- Debts, Public --- Eastern Caribbean Currency Union

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This IMF Staff Report for the 2016 Discussion on Common Policies of Eastern Caribbean Currency Union (ECCU) Member Countries highlights that the regional recovery in ECCU is gaining ground, supported by continued low oil prices, strong tourism arrivals, and robust citizenship-by-investment receipts. Risks to the near-term outlook are balanced, but growth in the ECCU continues to be hindered by weak competitiveness, banking sector fragilities, susceptibility to natural disasters, and large public debt. The Executive Directors have encouraged the authorities to press ahead with sound macroeconomic policies and structural reforms to decisively address these issues and strengthen the conditions for robust long term growth.

International Monetary Fund --- Eastern Caribbean Currency Union. --- Caribbean Area --- Economic conditions. --- ECCU --- Internationaal monetair fonds --- International monetary fund --- Banks and Banking --- Finance: General --- Public Finance --- Business and Financial --- Natural Disasters --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- General Financial Markets: Government Policy and Regulation --- Debt --- Debt Management --- Sovereign Debt --- Climate --- Natural Disasters and Their Management --- Global Warming --- National Government Expenditures and Related Policies: General --- Banking --- Public finance & taxation --- Natural disasters --- Financial services law & regulation --- Finance --- Public debt --- Public financial management (PFM) --- Financial regulation and supervision --- Environment --- Commercial banks --- Financial institutions --- Interest rate parity --- Financial services --- Banks and banking --- Debts, Public --- Finance, Public --- Financial services industry --- Law and legislation --- Interest rates --- Eastern Caribbean Currency Union

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This Selected Issues paper presents a quantification of the long-term benefits of ex-ante resilient investment and insurance needs against natural disasters (ND) in Eastern Caribbean Currency Union (ECCU). Cost-benefit analysis of resilient investment based on a dynamic stochastic general equilibrium model tailored to small states and calibrated to all ECCU economies is also discussed in the paper. The model’s aggregate production function illustrates the interaction among the participating sectors and their contribution to output, ultimately informing the role of resilient investment. The study also quantifies government insurance coverage needs and costs using an empirical stochastic model that simulates NDs fiscal costs. The insurance needs are framed within the World Bank insurance layering framework. The results in this paper underscore the importance of a shift from ex-post recovery to a focus on ex-ante resilience building. Ex-ante resilient investment and insurance are key to the welfare and financial sustainability of the ECCU, given high intensity and recurrence of NDs.

Natural disasters --- Fiscal policy --- Tax policy --- Taxation --- Economic policy --- Finance, Public --- Natural calamities --- Disasters --- Government policy --- Insurance --- Macroeconomics --- Public Finance --- Natural Disasters --- Climate --- Natural Disasters and Their Management --- Global Warming --- Fiscal Policy --- Debt --- Debt Management --- Sovereign Debt --- National Government Expenditures and Related Policies: Infrastructures --- Other Public Investment and Capital Stock --- Insurance Companies --- Actuarial Studies --- Public finance & taxation --- Insurance & actuarial studies --- Public debt --- Public investment spending --- Environment --- Expenditure --- Financial institutions --- Debts, Public --- Public investments --- Eastern Caribbean Currency Union

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper offers a preliminary assessment of the potential benefits and costs of an economic and monetary union (EMU) between the Dominican Republic and Haiti - two countries sharing the same island but whose history is one of conflict and divergent economic prospects in recent decades. After a brief review of the historical context, it examines the nature of these potential benefits and costs. It then conducts a preliminary analysis (using basic statistical techniques) of some key criteria for the formation of an economic and monetary union between the two countries. A more formal analysis of business cycle synchronization, based on basic and extended integrated vector auto-regression models with exogenous variables (VARX), is developed next. Overall, the analysis suggests that at this stage several economic criteria are not satisfied for the two countries to fully benefit from an economic and monetary union. At the same time, however, the endogeneity of most of these criteria (including the degree of business cycle synchronization) militates in favor of an aggressive medium-term agenda for integration between them.

Bilateral exchange rates --- Bilateral trade --- Business cycle --- Currencies and Exchange Rates --- Currency --- Currency union --- Customs union --- Debt Markets --- Economic growth --- Economic Stabilization --- Economic Theory & Research --- Emerging Markets --- Exogenous variables --- Finance and Financial Sector Development --- Fiscal policy --- Inflation --- Inflation rates --- Macroeconomics and Economic Growth --- Monetary union --- Monetary unions --- Output gap --- Output gaps --- Poverty reduction --- Price of oil --- Private Sector Development --- Real exchange rates --- Real interest rate --- World price