The Case of “EMU-Outsiders”: Economic and Political Considerations

2016

Our paper discusses the option of three EU countries – United Kingdom, Sweden and Denmark – of not joining the EMU and analyses whether besides their subjective option of staying out of the EMU there is also an economic reason behind this decision, based on existing literature in the field. The three “EMU-outsiders” are different in terms of economic power, financial market attributes, monetary policy rules employed and political decisions. In each case, the choice to remain outside EMU was based on economic reasons, as well as political and sometimes nationalist arguments. Of the three countries under scrutiny, Denmark is by far the one which has the best prospects of joining EMU, given it…