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This paper explains that the euro has served as the greatest economic policy experiment, uniting several large countries and facilitating greater competition, trade and financial stability. The paper points out that the euro spawned a new era of competition for Eurozone businesses, radically reducing transaction costs, creating a broader pool of savings with a diversified set of options for borrowers and increasing competition between legal environments. The paper also reports that the implications from increased international trade due to the euro include the elimination of deadweight loss and a gain to consumers. The paper concludes that the euro will continue to play a critical part as the Information Age continues to mold previously segmented economies into one thriving global economy.
Table of Contents:
Table of Contents:
From the Paper:"It is intuitive that sharing a common currency increases trade between a pair of countries, but the major question is why. Rose simply admits that he does not know. He speculates that a common currency might mean greater political commitment to a long-term economic integration or perhaps greater financial integration between two countries. While the reason behind this is still a puzzle, it nevertheless has many implications for both the EMU and the increasingly global economy."
Sample of Sources Used:
- Baldwin, Richard E. "The Euro's Trade Effect." March 2006. IDEAS. 17 March 2008 <http://www.ecb.europa.eu/pub/pdf/scpwps/ecbwp594.pdf>.
- Detken, Carsten and Philipp Hartmann. "Features of the Euro's Role in International Financial Markets." Economic Policy (2002): 553-569.
- Duisenberg, William F. "The euro as a catalyst for integration and competition in EMU." 13 June 2002. European Central Bank. 17 March 2008 <http://www.ecb.int/press/key/date/2002/html/sp020613.en.html>.
- Friedman, Thomas L. The World is Flat. Farrar, Straus and Giroux, 2005.
- Hau, Harald, et al. "How Has the Euro Changed the Foreign Exchange Market." Economic Policy (2002): 149-191.
Cite this Analytical Essay:
The Euro (2008, November 07) Retrieved January 24, 2020, from https://www.academon.com/analytical-essay/the-euro-108961/
"The Euro" 07 November 2008. Web. 24 January. 2020. <https://www.academon.com/analytical-essay/the-euro-108961/>