I am grateful to Zhaoyong Zhang, Kiyotaka Sato and the participants to the conference for many useful comments and suggestions.
Article first published online: 8 APR 2012
© 2012 Blackwell Publishing Ltd
The World Economy
Special Issue: MONETARY INTEGRATION AND EXCHANGE RATE REGIMES IN EAST ASIA
Volume 35, Issue 4, pages 405–418, April 2012
How to Cite
De Grauwe, P. (2012), Lessons from the Eurocrisis for East Asian Monetary Relations. World Economy, 35: 405–418. doi: 10.1111/j.1467-9701.2012.01443.x
- Issue published online: 8 APR 2012
- Article first published online: 8 APR 2012
I analyse the sources of the Eurozone crisis. The major conclusion is that the Eurozone is insufficiently embedded in a monetary union, thereby making it fragile and prone to crises. The lesson I draw for East Asia is that despite the fact that this region appears to satisfy the traditional optimal currency area (OCA) criteria to form a monetary union, the complete absence of political unification makes the prospect of a monetary union in that region of the world both unrealistic and undesirable.