Currency union

World map of current international currency unions

A currency union (also known as monetary union) is an intergovernmental agreement that involves two or more states sharing the same currency. These states may not necessarily have any further integration (such as an economic and monetary union, which would have, in addition, a customs union and a single market).

There are three types of currency unions:

The theory of the optimal currency area addresses the question of how to determine what geographical regions should share a currency in order to maximize economic efficiency.[2]

  1. ^ "World Bank" (PDF). WorldBank.org. Retrieved 30 April 2019.
  2. ^ Hafner, Kurt A.; Jager, Jennifer. "The Optimum Currency Area Theory and the EMU". Intereconomics. Retrieved 1 April 2021.

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