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European Monetary Union and Optimum Currency Areas

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  • John C.B. Cooper

    (Department of Economics, Glasgow Caledonian University, UK)

Abstract

Eleven European countries have now joined together in monetary union with a common currency and a common monetary policy. Whether a group of economies should form a monetary union depends upon how closely it resembles an optimum currency area. In general, an area where prices and wages are flexible or where labour moves freely or where there is a centralised fiscal policy may be viewed as an optimum currency area. However, the euro zone does not appear to meet any of these conditions.

Suggested Citation

  • John C.B. Cooper, 2000. "European Monetary Union and Optimum Currency Areas," Journal of Interdisciplinary Economics, , vol. 11(3-4), pages 211-223, July.
    • Handle: RePEc:sae:jinter:v:11:y:2000:i:3-4:p:211-223
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