The Prospects of a Mini Currency Union in 1999

Paul De Grauwe

No 1458, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: In this paper we analyse the prospects of a mini currency union in Europe. We argue that the Maastricht strategy will create a situation in which the countries excluded from the EMU will use their negative voting power to bar the entry of a number of core countries into the union. The countries excluded will have a strong legal basis to do so because several core countries will fail one or more Maastricht convergence norms. Thus, the scenario that the financial markets believe in today is highly unrealistic. Instead countries will be confronted with the choice of a maxi currency union or no currency union.

Keywords: Maastricht Treaty; monetary integration (search for similar items in EconPapers)
JEL-codes: F33 F36 F42 (search for similar items in EconPapers)
Date: 1996-09
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Citations: View citations in EconPapers (3)

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