The Eurozone as a Flawed Currency Area

Baimbridge, Mark, Burkitt, Brian and Whyman, Philip B orcid iconORCID: 0000-0002-3926-1019 (2012) The Eurozone as a Flawed Currency Area. The Political Quarterly, 83 (1). pp. 96-107. ISSN 00323179

[thumbnail of Publisher's post-print for classroom teaching and internal training purposes] PDF (Publisher's post-print for classroom teaching and internal training purposes) - Published Version
Restricted to Registered users only


Official URL:


The European single currency system has come under unprecedented strain during the past three years and there is little reason to assume that this will diminish, in any significant way, in the near future. This article briefly explores the background to the current eurozone crisis before outlining a number of potential solutions. Specifically, we discuss how the credit crunch induced recession of 2008 triggered the problems within the eurozone regarding sovereign debt, looking at the issues of spill-over and free-rider effects, together with the implementation of EMU fiscal rules. The analysis is then extended by outlining a series of potential remedies. This consists of a critical evaluation of solutions that the EU has already instigated (i.e. moral persuasion, financial relief measures and debt default), together with a series of alternative propositions (i.e. fiscal federalism and a European Clearing Union) and even the collapse of the euro.

Repository Staff Only: item control page