TY  - JOUR
AU  - Ghosh,Atish R.
AU  - Wolf,Holger C.
TI  - How Many Monies? A Genetic Approach to Finding Optimum Currency Areas
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 4805
PY  - 1994
Y2  - July 1994
UR  - http://www.nber.org/papers/w4805
L1  - http://www.nber.org/papers/w4805.pdf
N1  - Author contact info:
Atish R. Ghosh
Research Department
International Monetary Fund
HQ1-09-612
700 19th Street, N.W.
Washington DC, 20431
E-Mail: aghosh@imf.org

Holger C. Wolf
Center for German and European Studies
ICC-503
School of Foreign Service
Georgetown University
Washington, DC  20057
Tel: 202/687-8079
Fax: 202/687-8359
E-Mail: moneyhist@aol.com
AB  - Recent moves towards greater monetary integration in Western Europe - and disintegration in Eastern Europe and the former Soviet Union - have rekindled interest in the theoretical and empirical aspects of optimal currency areas (OCA).  In this paper, we examine the marginal benefit of increasing the number of currency unions within a given geographical area.  We look at six regions; the United States, Europe, the G7, the CFA zone, the FSU and the world at large. Our results suggest that (i) contiguous monetary unions are typically dominated by non-contiguous unions; (ii) neither Europe nor the United States form an optimum currency area, for both regions the costs of adopting a single currency exceeds estimates of the transaction cost savings; (iii) Germany and the United States will almost never find it to their (economic) advantage to join monetary unions.
ER  -