The euro at ten : the next global currency? /

In anticipation of the tenth anniversary of the euro on January 1, 2009, the Peterson Institute for International Economics and Bruegel (a European think tank founded in 2005) sponsored a conference in late 2008 that celebrated the success of the euro and speculated about its future. This volume contains the papers and discussion from that conference. The euro has given member countries low inflation, performed well in the 2008 financial crisis, reduced transactions costs, and developed into a strong regional currency heavily used in eastern Europe. However, the participants did not see it challenging the dollar as the global currency, major reasons being that European GDP will decline as a percentage of world GDP for demographic reasons; Europe lacks military power and a fiscal center that complement a global currency; and European financial markets are still not unified. In addition, network externalities imply that the supplier of a dominant currency must make mistakes--such as high inflation or uncontrolled government deficits--to lose dominance. Although this collection of papers forms a unified, insightful book, it is too technical for a general audience. Summing Up: Recommended. Upper-division undergraduate students through professionals. R. E. Schenk Saint Joseph's College (IN)