What Effects is Emu Having on the Euro Area and its Member Countries? An Overview

47 Pages Posted: 24 Apr 2006

See all articles by Francesco Paolo Mongelli

Francesco Paolo Mongelli

European Central Bank (ECB); Goethe University Frankfurt

Juan Luis Vega

Banco de España

Date Written: March 2006


This paper addresses the effects of the European Economic and Monetary Union (EMU) since the introduction of the euro on economic and financial structures, institutions and performance. What type of changes is the euro fostering? What forces is it setting in motion that were not there before? Six years after the launch of the euro, was an appropriate time to start taking stock of these effects. For this purpose, in June 2005, the ECB held a workshop on "What effects is EMU having on the euro area and its member countries?" The workshop was organised in five areas: 1. trade integration, 2. business cycles synchronisation, economic specialisation and risk sharing, 3. financial integration, 4. structural reforms in product and labour markets, and 5. inflation persistence. This paper sets the workshop in the context of the current debate on the effects of EMU and brings together several of the issues raised by the leading presentations: i.e., this paper serves as an overview. Overall, the effects of the euro observed are beneficial. However, progress has been uneven in the above areas. Many potential concerns preceding the launch of the euro have been dispelled. Moreover, it will take more time for the full effects of the euro to unravel.

Keywords: Optimum Currency Area, Economic and Monetary Integration, EMU

JEL Classification: E42, F13, F33, F42

Suggested Citation

Mongelli, Francesco Paolo and Vega-Croissier, Juan Luis, What Effects is Emu Having on the Euro Area and its Member Countries? An Overview (March 2006). ECB Working Paper No. 599, Available at SSRN: https://ssrn.com/abstract=887091

Francesco Paolo Mongelli (Contact Author)

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314

Goethe University Frankfurt ( email )

Grüneburgplatz 1
Frankfurt am Main, 60323

Juan Luis Vega-Croissier

Banco de España ( email )

Alcala 50
Madrid 28014

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