Literature Review: Critique of European Monetary Union

Abstract

The paper summarizes the literature of the explanations of the European debt crisis. We mainly use literature which was published after the financial crisis 2007/08. Many papers were written about the topic, but there is no clear overview about the different EMU critique. This paper tries to fill this gap. The discussions about advantages and disadvantages started at the end of the 1980s, but they intensified during and after the debt crisis. We classified the literature into non-European and European Economic Monetary Union (EMU) critique. Within the non-European literature especially US economists are relevant who referred to the issue of Optimal Currency Area (OCA). Europe did not fulfil the OCA criteria in their view. The European critique can be divided into ordoliberal, Post-Keynesian and heterodox thoughts. Most relevant for politics is still the ordo liberal EMU critique.