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Monetary union and the economic geography of Europe

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  • Midelfart-Knarvik, Karen Helene
  • Overman, Henry G.
  • Venables, Anthony

Abstract

Monetary union is likely to change the spatial structure of economic activity in the EU. This article reviews what is known about these effects and discusses the implications for EMU. We argue that EMU is likely to promote a modest increase in specialization amongst EU countries, although industry‐specific shocks are sufficiently small for this not to pose further difficulties for macroeconomic management. Improvements in market access are likely to raise income levels in insiders relative to outsiders. Taking a very long‐term view, the urban structure of the EU might be expected to become more polarized, developing a steeper size distribution.
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  • Midelfart-Knarvik, Karen Helene & Overman, Henry G. & Venables, Anthony, 2003. "Monetary union and the economic geography of Europe," LSE Research Online Documents on Economics 582, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:582
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    References listed on IDEAS

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    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics

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