Economic Themes (2013) 51 (3) 10, 579-591
Zenaida Šabotić, Srđan Marinković
Abstract: During the formation of a common currency area, the countries are guided by the benefits to be achieved, taking into account the relevant economic indicators. To what extent the formed currency area is optimal simultaneously, it can be said only after a certain period of its operation, when the disadvantages come up that may not be anticipated at the outset. The aim of this paper is to analyze the European Monetary Union. Assessing whether or not it is an optimum currency area for its current members, or it’s a community formed primarily on the basis of political parameters that economic indicators have to be adapted. Is it even possible to talk about the optimality of the union where member states have autonomy in shaping fiscal policy, with limits defined by convergence criteria, without prohibiting access, or excluding them, if these do not meet?
Keywords: optimal currency area; monetary integration; convergence criteria; the European Monetary Union
IS THE EUROPEAN MONETARY UNION AN OPTIMAL CURRENCY AREA? THEORETICAL RECONSIDERATIONS
Zenaida Šabotić, Srđan Marinković
Abstract: During the formation of a common currency area, the countries are guided by the benefits to be achieved, taking into account the relevant economic indicators. To what extent the formed currency area is optimal simultaneously, it can be said only after a certain period of its operation, when the disadvantages come up that may not be anticipated at the outset. The aim of this paper is to analyze the European Monetary Union. Assessing whether or not it is an optimum currency area for its current members, or it’s a community formed primarily on the basis of political parameters that economic indicators have to be adapted. Is it even possible to talk about the optimality of the union where member states have autonomy in shaping fiscal policy, with limits defined by convergence criteria, without prohibiting access, or excluding them, if these do not meet?
Keywords: optimal currency area; monetary integration; convergence criteria; the European Monetary Union
