Currency unions in prospect and retrospect

Silva, J.M.C. Santos and Tenreyro, Silvana ORCID: 0000-0002-9816-7452 (2010) Currency unions in prospect and retrospect. CEP Discussion Paper (986). London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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Abstract

We critically review the recent literature on currency unions, and discuss the methodological challenges posed by the empirical assessment of their costs and benefits. In the process, we provide evidence on the economic effects of the euro. In particular, and in contrast with estimates of the trade effect of other currency unions, we find that the impact of the euro on trade has been close to zero. After reviewing the costs and benefits, we conclude with some open questions on normative and positive aspects of the theory of currency unions, emphasizing the need for a unified welfare-based framework to weigh their costs and gains.

Item Type:	Monograph (Discussion Paper)
Official URL:	http://cep.lse.ac.uk/
Additional Information:	© 2010 The authors
Divisions:	Centre for Economic Performance
Subjects:	H Social Sciences > HG Finance H Social Sciences > HB Economic Theory
JEL classification:	F - International Economics > F3 - International Finance > F31 - Foreign Exchange F - International Economics > F0 - General > F02 - International Economic Order F - International Economics > F1 - Trade > F15 - Economic Integration F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F42 - International Policy Coordination and Transmission F - International Economics > F0 - General > F00 - General
Date Deposited:	22 Jul 2010 14:22
Last Modified:	10 Nov 2024 20:36
URI:	http://eprints.lse.ac.uk/id/eprint/28738

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