TY  - JOUR
AU  - Alesina,Alberto
AU  - Barro,Robert J.
TI  - Currency Unions
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 7927
PY  - 2000
Y2  - September 2000
UR  - http://www.nber.org/papers/w7927
L1  - http://www.nber.org/papers/w7927.pdf
N1  - Author contact info:
Alberto F. Alesina
Department of Economics
Harvard University
Littauer Center 210
Cambridge, MA 02138
Tel: 617/495-8388
Fax: 617/495-7730
E-Mail: aalesina@harvard.edu

Robert J. Barro
Department of Economics
Littauer Center 218
Harvard University
Cambridge, MA 02138
Tel: 617/495-3203
Fax: 617/496-8629
E-Mail: rbarro@harvard.edu
AB  - What is the optimal number of currencies in the world?  Common currencies affect trading costs and, thereby, the amounts of trade, output, and consumption.  From the perspective of monetary policy, the adoption of another country's currency trades off the benefits of commitment to price stability against the loss of an independent stabilization policy.  The nature of the tradeoff depends on co-movements of disturbances, on distance, trading costs, and on institutional arrangements such as the willingness of anchor countries to accommodate to the interests of clients.
ER  -