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Northwestern Pritzker School of Law

Northwestern Journal of International Law & Business

1991

European Economic Community; Single European Act; European Currency Unit; Great Britain

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A Rapid Or Evolutionary Approach: The Eec's Adoption Of The Ecu As A Common Currency, Susan B. Shulman Jan 1991

A Rapid Or Evolutionary Approach: The Eec's Adoption Of The Ecu As A Common Currency, Susan B. Shulman

Northwestern Journal of International Law & Business

Perhaps the EEC should move to a common currency, but there is no reason to rush towards such a dramatic change. According to optimal currency area theory, the current system of limited flexibility within the EEC is ideal. Any move to a common currency should be flexible in that it initially allows member states the ability to use national monetary policy if necessary. The British proposal allows just this kind of flexibility.