An Optimum Currency Area

Malcolm Crawford

Chapter 7 in One Money for Europe?, 1996, pp 97-104 from Palgrave Macmillan

Abstract: Abstract A single currency is more suitable for some areas of the world than for others. While there are always economic benefits from having a single currency, through savings on the transactions costs of currency exchanges, hedging, and so on, there can be offsetting costs if a single currency stands in the way of economic adjustments that may be initiated or assisted by monetary policy. Monetary policy, if used actively, requires exchange-rate flexibility, as we have seen above.

Keywords: Exchange Rate; Monetary Policy; Real Exchange Rate; Real Wage; Monetary Union (search for similar items in EconPapers)
Date: 1996
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-25035-6_7

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DOI: 10.1007/978-1-349-25035-6_7

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