EMU as Optimal Currency Area

  Peter Hoeller, Claude Giorno and Christine de la Maisonneuve (2004) "One Money, One Cycle? Making Monetary Union a Smoother Ride", OECD Economics Department Working Paper Nr 401.

• Sectonal Specialization in the EU: A Macroeconomic Perspective, ECB OCCASIONAL PAPER SERIES NO. 1 9 / J U LY 2004

• Artis M.J. and W. Zhang (1997), "International business cycles and the ERM: Is there a European business cycle?", International Journal of Finance and Economics, 2, 1-16.

• Canzoneri, Matthew B. and Carol Ann Rogers (1990), Is the European Community an Optimal Currency Area? Optimal Taxation Versus the Cost of Multiple Currencies, 80(3), 419-433.

EU and EMU...

• Artis, Mike (2004), Economic Theory as a Decision Tool. OCA Theory: the UK and the Euro, mimeo.

• Nils Gottfries (2003)," Booms and Busts in EMU", mimeo Uppsala University.

UK and EMU

Assessing the Assessment: A Critical Look at the June 2003 Assessment of the United Kingdom's Five Tests for Euro Entry by Cottarelli, Carlo | Escolano, Julio, IMF working paper

Costs and Benefits: Traditional Views back to top

Recent debates...

The role of exchange rate flexibility without expenditure switching effects

• "Monetary Policy in the Open Economy Revisited: Exchange Rate Flexibility and Price Setting Behavior," Charles Engel and Michael B. Devereux, Review of Economic Studies 70, October 2003, 765-783.

• Monetary Policy in Open Economy Revisited: the case for exchange rate flexibility restored. by M Obstfeld and M Duarte

• Buiter, Willem (2000) "Optimal Currency Areas: Why Does the Exchange Rate Regime Matter?", Scottish Journal of Political Economy, 47: 213-250.

Political Economy

• Alesina, Alberto and Barro (2002), Currency Unions, Quarterly Journal of Economics 117.

• Kletzer, Ken (1998), Monetary Union, Asymmetric Productivity Shocks and Fiscal Insurance: an Analytical Discussion

Classic texts...

• R. Mundell, “A Theory of Optimum Currency Area”, American Economic Review, 1961, p.657-665.

• R. McKinnon, “Optimum Currency Areas”, American Economic Review, 1963, p.717-725.

• P. B. Kenen, “The Theory of Optimum Currency Areas”, in: R. Mundell and A. Swoboda,eds.), Monetary Problems of the International Economy, Chicago University Press, 1969.

• Bayoumi T. and B. Eichengreen (1993), "Shocking aspects of European Monetary Integration", in Torres F. and F. Giavazzi (eds.), Adjustment and Growth in the European Monetary Union, Cambridge University Press: Cambridge.
Bayoumi T. and B. Eichengreen (1996), "Operationalising the theory of Optimal Currency Areas", CEPR Discussion Papers, 1484.

Endogeneity back to top

• Corsetti, Giancarlo and Paolo Pesenti (2002), Self-Validating optimum currency areas, mimeo.

• Micco,A., Stein, E. and G. Ordoñez (2003) "The Currency Union effect on trade; early evidence from EMU", Economic Policy, 37, October, 315-356.

• Glick, Reuven and Andrew Rose (2002) "Does a Currency Union Affect Trade? The Time Series Evidence." European Economic Review. 46( 6), 1125-1151

• Frankel J. and A. Rose (1997), "Is EMU more justifiable ex-post than ex-ante?" European Economic Review, 41, 753-760.

• Frankel J. and A. Rose (1998), "The endogeneity of the optimum currency area criteria", Economic Journal, 108 (449), 1009-1025.

• Raffaele Pace and Riccardo Rovelli (1998), Do trade and technology reduce asymmetries? Evidence from manufacturing industries in the EU