European Monetary Integration with Benefit of Hindsight

Abstract:
The year 2009 saw a series of events celebrating the first decade of Europe's monetary union. Within a year, however, the eurozone descended into the most serious crisis in its short history. The question posed in this article is whether scholarly analysis of European monetary integration was deficient in ways that led observers to miss impending problems. The answer given here is that the standard analysis was broadly on the mark, although it missed the need for effective oversight of banking and financial systems at the level of the monetary union and underemphasized political economy considerations.