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We do two things in this paper. First, we look at some simple models of monetary decision making in a monetary union & ask how much more variable a country's output & inflation is likely to be if it joins the union. We answer this analytically & then go on to "calibrate" the simple model. The model has few structural equations, but it is useful in allowing us to examine how the variability of output & inflation are likely to change as key parameters change. Our conclusions on this front are likely to be sensitive to model specification. However, we also identify a second best issue concerning the optimal make-up of the monetary union that is likely to be more robust: namely that only when all members of the union have the same structural parameter values (& shocks are perfectly correlated) will it be optimal for a new member to have these same structural parameter values. 1 Table, 1 Figure, 1 Appendix, 36 References. Adapted from the source document.

The authors present and analyses the effects of introducing EURO on the European Union Market. On 1 January 2002, the euro banknotes and coins are introduced in 12 Member States of the European Union. But what is the background to the euro? Which countries are involved? How did the euro evolve? On the following pages, you will find the answers to these and many other questions along with all the information you will need about the biggest monetary changeover in history. So, whether you are in Europe or elsewhere in the world, why not take a journey with us to discover how the euro evolved?

How should European monetary coordination develop? John Chown and Geoffrey Wood argue that the European central banks should be forced to compete in providing the best monetary services.

The recent crisis in the ERM has meant EMU can no longer proceed along
the lines proposed in the Maastricht Treaty. Proposes that a two or
even multi‐speed EMU should emerge from the crisis. This would be based
on a "hardcore" which would form the basis for exchange rate/macro
policy management for "softer" countries.