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Determinants and Implications of the Eurozone Enlargement

Author

Listed:
  • Gregorz W. Kolodko

    (Transformation, Integration and Globalization Economic Research (TIGER), Kozminski University, Warsaw, Poland)

  • Marta Postula

    (Center of Entrepreneurship at the Faculty of Management, Warsaw University, Poland)

Abstract

To join the Eurozone (EZ), a candidate country has to fulfil five nominal Maastricht convergence criteria and ensure compliance of national legislation with the acquis communautaire. With this regard special difficulties pose the fiscal criterion relating to the maximum allowed budget deficit of 3 per cent of GDP. If it is not met, the European Commission launches the Excessive Deficit Procedure. Currently, such formula applies to France, Spain and the United Kingdom. Although the issue is not absolutely certain, one can assume that euro will weather the present difficulties and will come out stronger, though the economically unjustified Euro scepticism of some countries is not helping. It may be expected that in the 2020s the European Monetary Union will be joined by all countries that are still using their national currencies and that the EU will be extended to include new member states, enlarging the euro area further. In this article authors are discussing the issue whether Poland will join the EZ in the coming years, considering the challenges of meeting all Maastricht criteria, on the one hand, and the reluctance of the government to give up the national currency, on the other. A mixed method combining the results of qualitative and quantitative research has been used to empirically verify the research question presented.

Suggested Citation

  • Gregorz W. Kolodko & Marta Postula, 2018. "Determinants and Implications of the Eurozone Enlargement," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 68(4), pages 477-498, December.
    • Handle: RePEc:aka:aoecon:v:68:y:2018:i:4:p:477-498
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    References listed on IDEAS

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    1. Padilla León, 2020. "Can Monetary Integration Improve Productivity? Empirical Evidence of Eurozone," South East European Journal of Economics and Business, Sciendo, vol. 15(2), pages 57-69, December.

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    More about this item

    Keywords

    integration; euro convergence; Maastricht criteria; excessive deficit procedure; public debt;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • G01 - Financial Economics - - General - - - Financial Crises
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • P34 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Finance
    • P52 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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