Practice question · Select all that apply
Which are OCA criteria for a well-functioning currency union?
Hints
- The criteria concern synchronised cycles, mobility and transfers.
- Separate national monetary policies contradict the whole arrangement.
Show the answer
- A. Synchronised business cycles
- B. Fiscal transfers from booming to depressed regions
- C. Labour mobility across member states
Why
Synchronised cycles, mobile labour, and fiscal transfers, the three OCA conditions. Having separate central banks contradicts the point of a currency union.
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