Title: GCC monetary union and the transmission of business cycles: evidence from temporal correlations

Authors: Imed Medhioub; Lotfi Ben Jedidia

Addresses: College of Economics and Administrative Sciences, Department of Finance and Investment, Al-Imam Muhammad Ibn Saud Islamic University (IMSIU), P.O. Box 5701, Riyadh, Saudi Arabia ' College of Economics and Administrative Sciences, Department of Finance and Investment, Al-Imam Muhammad Ibn Saud Islamic University (IMSIU), P.O. Box 5701, Riyadh, Saudi Arabia

Abstract: The aim of this paper is to verify the readiness for monetary union among Gulf Cooperation Council (GCC) countries. To do so, we know that business cycle synchronisation is a good tool to test for the possible success of a monetary union. The empirical results for the GCC countries are close to those for the OECD and European Union countries, especially for the case of Saudi Arabia and the UAE. Thus, the economic and financial indicators are positive, implying that the GCC countries are ready for the creation of a monetary union, but political decisions will be more effective in reducing the barriers to the creation of this union.

Keywords: monetary union; Gulf Cooperation Council; GCC countries; trade intensity; financial integration; specialisation; temporal correlation; business cycles.

DOI: 10.1504/IJMEF.2017.081284

International Journal of Monetary Economics and Finance, 2017 Vol.10 No.1, pp.1 - 23

Available online: 02 Jan 2017 *

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