Title

A Mining Driven Decision Support System for Joining the European Monetary Union

Document Type

Contribution to Book

Publication Date

7-1-2018

Publication Title

Eighth International Conference on Advances in Information Mining and Management (IMMM’18)

ISBN

978-1-61208-654-5

ISSN

2326-9332

Abstract

The European Monetary Union (EMU) is a result of an economic integration of European Union member states into a unified economic system. The literature is divided on whether the EMU members benefit from this monetary unification. Considering costs and benefits, a fiscal authority may ask whether it is a good decision to join the EMU. We introduce and develop a decision support system to answer the proposed question using a historical dataset of twelve Macroeconomic Outcomes (MOs) obtained for 31 European countries and for 18 years (1999-2016). The system meets the three-prong goal of: (1) identifying highly relevant MOs for a given year, yi, using the data from years y1 to yi; (2) deriving decision of “join/not-join” the EMU along with its certainty factor using the relevant MOs for yi; and (3) examining the accuracy of the derived decision using the data from yi+1 to y18. The performance analysis of the system reveals that (a) the number of relevant MOs has declined nonlinearly over time, (b) the relevant MOs and decisions are significantly changed before and after the European debt crisis, and (c) the derived decisions by the system has 79% accuracy.

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