The euro area in 2016: unfinished business / Why the euro area needs new convergence goals and how to choose them

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Series Details 06.01.16
Publication Date 06/01/2016
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What does 2016 hold in store for efforts aimed at strengthening Europe’s Economic and Monetary Union? Benedicta Marzinotto writes that when compared with previous monetary regimes, the euro area remains unstable and in need of reform. She argues, however, that the lack of political appetite for cooperative solutions implies a sovereign default is possible in Greece in 2016 and potentially elsewhere in the Eurozone.

Economic convergence is generally taken as an important requirement for the euro area to function correctly. Without this, the significant differences between euro area economies could make sharing a currency problematic. As Anna auf dem Brinke writes, however, political and market forces have so far proven unable to prevent imbalances between member states. She argues that new convergence goals should be a key priority for the euro area and suggests a number of principles for choosing better convergence indicators.

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ESO: Background information: After the Greek deal: Why it is urgent to complete EMU
ESO: Background information: Completing Europe's Economic and Monetary Union: Commission takes concrete steps to strengthen EMU
ESO: Background information: Completing Economic And Monetary Union [What Think Tanks Are Thinking]
Blog: LSE Europpblog, 07.01.16: Why the euro area needs new convergence goals and how to choose them

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