The Study of Nominal Convergence in European Union

Abstract

The main idea of fulfilling all convergence criteria when a country wants to adopt euro is to ensure that only the Member States that have the adequate economic conditions to maintain the price stability and the coherence of the euro area can be a part of Euro Zone. As a result, today, the individual criteria are interpreted and applied in a strict manner. Unfortunately for the Euro Zone, at the beginning of EMU, the Maastricht criteria were not applied so strictly. On the other side, many countries that are using now the euro as their currency are not fulfilling all the criteria. Starting from these controversies, the main objectives of our paper are to study the degree of fulfillment of convergence criteria in the moment of euro adoption for the 17 countries that are using today the European currency and to assess the evolution of nominal convergence during the time span 1995 – 2011.