Maastricht Criteria Research Articles

European Financial Markets Integration and the Politics of Credit Rating Agencies: An Econometric Approach to Study Microeconomic Dynamics and Sustainability

Abstract On sovereign credit default swaps markets, contagion serves as a sobering reminder of the interconnectedness of global financial systems. Like ripples in a pond, the impact of sovereign default or downgrades can cascade across borders, highlighting the intricate web of dependencies among nations. Utilizing sovereign CDS spreads between 2006-2020 on local European markets, the study employs an event study methodology to assess the effects of rating changes on CDS spreads, focusing on negative events such as sovereign rating downgrades. The findings reveal that negative events have a greater impact on the CDS market than positive events, abnormal returns are higher during economic crises, and states with public debt exceeding the Maastricht criteria experience higher abnormal returns. These results suggest that investors are sensitive to adverse news and risk factors, see opportunities for profit during economic turmoil, and closely monitor fiscal sustainability metrics. Understanding and managing contagion risk in these markets requires not only vigilance but also cooperation and coordination among policymakers and market participants.

Впливи пандемії COVID-19 на стан світової та національних економік

The article analyses the peculiarities of the global pandemic COVID-19 impact and related quarantine restrictions imposed on the economic growth of Ukraine and other countries of the world. The purpose of the study is to determine the negative consequences of such an impact due to the global pandemic COVID-19, as well as to outline the effectiveness of implemented (planned) measures of governments to neutralize the effects of this impact on the economy. Particular attention is paid to: the study of changes in GDP dynamics, the volume of foreign trade, and the level of public debt in different countries of the world in three phases of the pandemic: I-phase (2019–2020), II-phase (2021-2022) and III-phase (second half of 2022, first half of 2023); determining the effectiveness of anti-crisis measures of governments during the global crisis of 2019–2022. The scientific paper notes that the negative factor influencing the quality to the economic growth of the country’s world (during the pandemic) is non-diversification of economies with emerging markets and their dependence on global foreign trade flows. It has been determined that the increase in social spending and the level of debt in developing countries is a threat to their financial security in the future, since the maximum level of public and guaranteed debt in relation to GDP in some countries exceeded the limit of 60% according to the Maastricht criteria.

Swine intestinal segment perfusion model for the evaluation of nutrients bioaccessibility.

Nutrition science requires more science-based evidences for the development of effective functional diets. To reduce animals for experimental purposes innovative reliable and informative models, simulating the complex intestinal physiology, are needed. The aim of this study was to develop a swine duodenum segment perfusion model for the evaluation of nutrient bioaccessibility and functionality across time. At the slaughterhouse, one sow intestine was harvested following Maastricht criteria for organ donation after circulatory death (DCD) for transplantation purposes. Duodenum tract was isolated and perfused in sub-normothermic conditions with heterologous blood after cold ischemia induction. Duodenum segment perfusion model was maintained under controlled pressure conditions through extracorporeal circulation for 3 hours. Blood samples from extracorporeal circulation and luminal content samples were collected at regular intervals for the evaluation of glucose concentration by glucometer, minerals (Na+, Ca2+, Mg2+, K+) by ICP-OES, lactate-dehydrogenase and nitrite oxide by spectrophotometric methods. Dacroscopic observation showed peristaltic activity caused by intrinsic nerves. Glycemia decreased over time (from 44.00±1.20 mg/dL to 27.50±0.41; p < 0.01), suggesting glucose utilization by the tissue confirming the organ viability in line with histological examinations. At the end of the experimental period, intestinal mineral concentrations were lower than their level in blood plasma suggesting their bioaccessibility (p < 0.001). A progressive increase of LDH concentration over time was observed in the luminal content probably related to a loss of viability (from 0.32±0.02 to 1.36±0.02 OD; p < 0.05) confirmed by histological findings that revealed a de-epithelization of the distal portion of duodenum. Isolated swine duodenum perfusion model satisfied the criteria for studying bioaccessibility of nutrients, offering a variety of experimental possibilities in line with 3Rs principle.

Optimum currency areas: State of research, the European Monetary Union

The present paper deals with optimum currency areas (OCA). Its main goal is to give a synthesis of the central research areas in this field and provide a link to the real-life example of the European Monetary Union (EMU). Overall, the paper will possibly uncover potential areas for further research, and thus may be able to serve other researchers. The article illustrates the original OCA theory by Robert Mundell and further important research built upon it. The OCA criteria resulting from the foregoing research are then placed aside the actual Maastricht criteria set up by the European Union, necessary to fulfil for joining the eurozone. The question of whether these criteria are even necessary is examined alongside the topic of endogeneity, which is a relatively new field of research in the OCA field. Lastly, the pros and cons of joining a single currency area are analyzed, before the author provides suggestions for potential future research.

Readiness of the Czech Republic to Join the Euro Area

The Czech Republic has been a member of the European Union since 2004. As a Member State, it is obliged to join the euro area upon meeting all the Maastricht criteria. There is still no fixed date for adopting the single European currency. The Czech Republic is failing to meet some criteria. There are ongoing discussions about joining the euro among experts, bank representatives, politicians, entrepreneurs, representatives of the Czech Chamber of Commerce and various associations, economics students and the general public. The aim of this paper is to assess the ongoing fulfilment of the Maastricht convergence criteria in the Czech Republic and to identify the relationship between actual and perceived inflation. The paper reflects new aspects, which were generated by the recent development on financial markets during the last 2 years, including COVID-19 and Russian attack to Ukraine. Due to the fact, that not all statistics reflects recent development, some tables and charts are not reflecting this for hundred percent. The analyses carried out reveal that the only criterion that is currently met is the level of public debt (sustainability will be assessed at the time of application). Smooth adoption of the euro by the public is associated with an increased perception of inflation above actual inflation. This situation should be addressed by economic policy actors in preparation for joining the euro area. The importance of a government communication and explanation campaign was confirmed by countries in a similar position. Since February this year, Europe and the whole world have been facing a new geopolitical situation. There are voices calling for Europe to become stronger, more compact, perhaps move towards a federation, including a strengthening of the common currency’s position. Therefore, this is a highly topical issue. The final decision in the Czech Republic to start the process of adopting the euro and to set the date for joining the euro area rests with the Czech Government in cooperation with the Czech National Bank.

The role of German media and the (European) public sphere: Framing biases of the press using the example of the Italian sovereign debt crisis 2018

During times of crisis, the press plays a crucial role in communicating and negotiating the crisis. Considering Germany’s strong economic role in the EU, the German (media) perspective on European economic policy issues has a major influence on Europe. In 2018, Italy’s debt crisis posed the risk of a new euro crisis and a domino effect on other countries. Contrasting views of how to resolve economic crises opposed each other, with the Maastricht criteria at the center. Despite high debt, the Italian government pursued a Keynesian policy by increasing the deficit to stimulate economic growth. The European Commission, however, insisted on neoliberal policies and compliance with the criteria. This study discusses the (non)emergence of a European public sphere through the economic policy framing of the Italian sovereign debt crisis. Using quantitative content analysis, the relative prevalence of frames rooted in competing economic policy paradigms (neoliberal/Keynesian) in press coverage is examined. The results show that the neoliberal paradigm and the call for austerity dominate coverage, indicating a possible European public sphere. However, the biased media framing in favor of the European Commission’s and German government’s interests partly contributes to strengthening the nationalistic perspective on this European issue. Overall, the press failed to present the issue in a solution-oriented and pluralistic manner.

Ready or not? Constructing the Monetary Union Readiness Index

Abstract While all EU Member States can join the group's monetary union, the euro area, some members are far more ready for the adoption and use of the single European currency. Here, we construct a new Monetary Union Readiness Index (MURI) for the EU Member States. The theoretical framework of the index is built on the economic theory of Optimal Currency Areas and EU regulations such as the Treaty and the Maastricht criteria, and the Regulation on the Macroeconomic Imbalance Procedure. The index measures (i) nominal convergence, (ii) real convergence, and (iii) macroeconomic stability. The MURI Index provides an easy to use real-time policy tool to evaluate both candidate and current euro area members. Hence, it complements, aggregates and communicates key information in annual convergence reports and in official statistics. Our evaluation finds that Austria, Finland, Denmark, Sweden and Germany showed the highest level of compliance with the different euro area criteria in 2018, while Greece, Cyprus, Romania, Spain, and Italy were the least compliant.

It is not about Croatia and Bulgaria: it is about the fundamentals of membership of the euro area

This article was invited from the author in response to the June 2022 Bruegel.com blog post by Zsolt Darvas – and see the separate article in this issue – about the decision to let Croatia into the euro area while keeping Bulgaria out; and intended to elicit a view from Bulgaria. The author believes that Darvas is essentially right in his approach; and that, furthermore, the applications of Croatia and Bulgaria for entry to the euro area are a perfect example of why the whole framework needs a thorough re-consideration. The founding fathers of the euro area constructed it on the basis of fundamental principles of macroeconomic stability and the equal treatment of applicants. Consequently, most of the criteria for adopting the euro, the so-called Maastricht criteria, have numerical expressions: clear and transparent criteria do not open any room for interpretations and compromises with macroeconomic stability. In the last decade, however, the author argues that the flexible interpretation of these criteria has led to changes making the accession process more discretionary and euro area membership less attractive.

Debt strategies of European countries and vectors of implementation of best experience in the practice of external public debt management of Ukraine

The policy of external and domestic public debt management in different countries has its own specifics, and its results are not always unambiguous. Thus, the existing recommendations of the International Monetary Fund and the Maastricht criteria prove that the maximum value of public debt to GDP should be no more than 60 %. Exceeding this limit can lead to a deterioration in financial stability, debt sustainability, and ultimately to a technical default of the state. However, the practice of public debt management in many developed countries shows quite opposite trends, as a significant excess of the Maastricht criterion not only does not lead to default, but on the contrary allows countries to accumulate the necessary financial resources to ensure stable economic growth.&#x0D; Therefore, the study of European debt strategies and their effectiveness is a very important issue, especially given the consequences of the COVID-19 pandemic for developing countries. Given the growing external debt dependence of Ukraine as a result of both the war with the Russian Federation and the COVID-19 pandemic, the search for a better experience of European debt policy and consideration of ways to adapt it to domestic realities are discussed in our article.&#x0D; Based on the analysis of the debt policy of European countries, the expediency of using debt rules, aimed at regulating both the country's debt security and the effectiveness of the use of public borrowing to stimulate economic growth has been proved.&#x0D; Cluster analysis of debt strategies of some European countries has shown that the high level of dependence on external public debt has a negative impact on economic security in general, because in the event of deteriorating macroeconomic situation, the likelihood of foreign investors selling government securities increases, and in the case of external loans from international financial and credit organizations – the risks of negative impact of burdensome non-financial obligations on the national economy grow.

The European Semester and Parliamentary Oversight Institutions Inside and Outside of the Euro Area

The European Semester is a challenge for national parliaments but also an opportunity to reform domestic oversight institutions. Drawing on data from all member states, this study examines the conditions under which national parliaments use this opportunity. Is Euro area membership a prerequisite for parliamentary adaptation to the European Semester and, if so, which further combinations of conditions account for variation among Euro area countries? The analysis suggests that membership in or close ties with the Euro area and institutional strength constitute &lt;em&gt;necessary conditions&lt;/em&gt; for parliamentary adaptation. Combined with other factors—in particular, public debt exceeding the Maastricht criteria—these conditions explain reform in many cases. National parliamentary adaptation to the European Semester thus follows existing institutional divisions constituted by differentiated integration in the Euro area and uneven national parliamentary strength.

Assessing unrealised potential for organ donation after out-of-hospital cardiac arrest

BackgroundOrgan donation after brain death is the standard practice in many countries. Rates are low globally. This study explores the potential national number of candidates for uncontrolled donations after cardiac death (uDCD) amongst out-of-hospital cardiac arrest (OHCA) patients and the influence of extracorporeal cardiopulmonary resuscitation (ECPR) on the candidacy of these potential organ donors using Singapore as a case study.MethodsUsing Singapore data from the Pan-Asian Resuscitation Outcomes Study, we identified all non-traumatic OHCA cases from 2010 to 2016. Four established criteria for identifying uDCD candidates (Madrid, San Carlos Madrid, Maastricht and Paris) were retrospectively applied onto the population. Within these four groups, a condensed ECPR eligibility criteria was employed and thereafter, an estimated ECPR survival rate was applied, extrapolating for possible neurologically intact survivors had ECPR been administered.Results12,546 OHCA cases (64.8% male, mean age 65.2 years old) qualified for analysis. The estimated number of OHCA patients who were eligible for uDCD ranged from 4.3 to 19.6%. The final projected percentage of potential uDCD donors readjusted for ECPR survivors was 4.2% (Paris criteria worst-case scenario, n = 532) to 19.4% of all OHCA cases (Maastricht criteria best-case scenario, n = 2428), for an estimated 14.3 to 65.4 uDCD donors per million population per year (pmp/year).ConclusionsIn Singapore case study, we demonstrated the potential numbers of candidates for uDCD among resuscitated OHCA cases. This sizeable pool of potential donors demonstrates the potential for an uDCD program to expand the organ donor pool. A small proportion of these patients might however survive had they been administered ECPR. Further research into the factors influencing local organ and patient outcomes following uDCD and ECPR is indicated.

Maastricht Kriterleri Avrupa Birliği’nin Geleceğinin Teminatı mı? Almanya - Britanya - İspanya - Yunanistan Analizi (1998-2018)

Aslında birer Yakınsama Kriteri olma özelliği gösteren Maastricht Kriterleri, kurallı maliye politikasının en somut ve bir o kadar da popüler örneği konumundadır. Mali kurallar, kamusal kaynakları kullanan politikacıları sınırlandırma özelliğinin yanı sıra makroekonomik performansın iyileştirilmesini hedef alır. İkinci tipe örnek olan Maastricht Kriterleri, ikisi mali ve üçü iktisadi özellik gösteren toplam beş kuraldan oluşur. Devletlerin sergilediği performansların kurallara uymaması, yani yaşanan kuralsızlık, çeşitli yaptırımlara tabidir. Çalışmada seçilen dört ülkenin yirmi yıl boyunca sergilediği performanslar incelenmiştir. Buna göre, varsa oluşan sapmalar, nedenleriyle ele alınarak ne gibi yaptırımlar uygulandığı araştırılmış ve ulaşılan bilgiler ışığında Maastricht Kriterleri’nin Avrupa Birliği’nin geleceği için bir tür teminat olup olmadığı tartışılmıştır.

ВИКОРИСТАННЯ НЕЧІТКОЇ ЛОГІКИ ДЛЯ ОЦІНКИ ЗДОРОВ’Я ЕКОНОМІКИ УКРАЇНИ

An important component of public economic management is to achieve a balance between the various targets of public policy and the formation of a healthy economy. A healthy economy is the basis for stable economic growth and a buffer to minimize the negative impact of external risks. The purpose of the article is to assess the “health” of Ukraine’s economy in the dynamics and in comparison with European countries. The authors used two approaches to assessing the health of the economy, namely: the Maastricht criteria (including inflation, deficit, government debt, exchange rate and long-term interest rates) and the approach of K. Collins (based on inflation, unemployment and GDP per capita). The authors assessed the health of the economy of Ukraine and EU countries for the period 2003–2020 using the fuzzy logic method, which is implemented in the MATLAB application package. Both models indicate that the most threatening situation in Ukraine was in 2008 and 2014–2015. This is completely true, because it was then that the Ukrainian economy was experiencing periods of crisis. At the same time, the best indicators of the health of the Ukrainian economy were in 2003, 2005, 2011, 2018–2019. According to both approaches, the economy of Ukraine throughout the study period can be described as “sick”, although not catastrophic. This means that even minor deteriorations in public debt, budget deficits, and the national currency exchange rate can have significant negative consequences that will be very difficult for the economy to overcome. A comparative analysis with EU countries showed that Ukraine’s economy is in a worse state compared to European countries throughout the study period. The article systematizes the types of negative economic effects due to the coronavirus crisis, namely: loss of GDP; disability and treatment costs; disability losses due to illness lasting from 3 weeks or more; losses of the economy from quarantine restrictions. Given that Ukraine’s economy is in a state of “sickness”, economic losses in the event of a continuation of the coronavirus crisis could become catastrophic and provoke a sharp deterioration in the economy.

Fiscal Challenges in Pandemic Times

The unexpected health crises that appeared at the end of 2019 and endures currently hadtriggered serious government challenges in conducting efficient fiscal policy. The growinghealth, educational, social, and other costs corelated with the health crisis had raisedintense reactions in governments through higher public expenditures that were financeddominantly from international financial markets. Already higher public debt to GDP ratioin some countries overcome the Maastricht criteria of this crucial fiscal variable that raisedsome serious questions for future government financial responses. This pandemic openedsome suggestions and considerations for major or minor tax reforms in some countries.If previously the governments were repellent to introduce some tax changes, now they seeopportunity to easily justify this fiscal step. The people subjected to COVID-19 disease areaddressing more publicly the need for substantial government help regarding the healthcosts. The IMF surveys show that people who faced this illness are more demanding forchanges in distributional fiscal function. The companies and households with extra profitsand income should be taxed with higher income tax rates and corporate taxes. The reasonfor this demand is the ongoing process of unevenly distributed national income that inpandemic circumstances affects more lower layers of income households. However, thereal sector in North Macedonia is publicly against higher tax rates, and they demand fromgovernment first to legalize the grey economy that they perceived as serious competitiveand fiscal problem.

Common Currency Area in GCC Region: An Application of Euro Model

US Dollar (USD) is the most dominant currency encompassing 59.54% of the world reserve currency. Euro is the second one, which holds 20.57% share of world reserve currency. The recent studies reveal that the USD might not be the dominant world reserve currency in the future. Euro as a common regional currency is the only competitor of USD, which shows the strength of a unified regional currency. In 1981, the six rich oil states formed Gulf Cooperative Council (GCC); the countries include the Kingdom of Saudi Arabia, the State of Qatar, the Sultanate of Oman, the Kingdom of Bahrain, the State of Kuwait, and the United Arab Emirates. This establishment of GCC signifies the close cultural, economic and political link between the GCC countries. GCC countries have almost all essential ingredients required to establish a common currency area or monetary union. The researcher applied the European Monetary Union (EMU) model to GCC states to find out the feasibility of a common currency or monetary union between GCC states. Currently, EMU is the only example of successful implementation of common regional currency founded on Mundell’s theory of Optimum Currency Area (OCA). The results obtained indicate that all the GCC states successfully fulfill the Euro criteria which are also called Maastricht criteria. The research has established that GCC countries are ripe for establishing a monetary union, especially if they follow the steps of EMU.

THE EU ECONOMY MANAGEMENT SYSTEM IN CONDITIONS OF ECONOMIC CRISIS. IRELAND’s CASE

In 2008 the world faced a powerful economic crisis, which led to significant problems in the EU. Some states, such us Portugal, Italy, Ireland, Greece and Spain, were on the verge of default. In such conditions the EU had to take appropriate measures to save European countries. The author reviewed the measures which concerned Ireland. At the beginning of the century Irish economy showed rapid growth. But in 2010 the default threatened “The Celtic tiger”. It was conditioned by the collapse of mortgage landing system and the rapid outflow of foreign capital. As far as Ireland participates in the euro zone the other European countries are interested in the stabilization of Ireland’s economy. All measures of saving Ireland’s economy could be divided to two groups. The first group includes the measures taken by the government of Ireland. This is state financing of bank sphere, which was done without being agreed with the EU (moreover, the European council reacted negatively), and changing of tax rate approved by the EU. The second group is represented by the measures of European institutes. It includes preferential credits and suppression of sanctions for violation of Maastricht criterion in exchange for austerity budget. In Ireland’s case such policy doesn’t seem really effective. The level of Ireland’s budget deficit is more than 3 % of GDP and its current economic growth does not permit to redeem the loans. Economic problems provide political instability, that’s why Ireland’s government cannot elaborate long-term financial policy. Though European institutes managed to find consensus between different national interests, the EU needs no less than 15 years to return to pre-depression economic level.

Sovereign debt crisis management by the European Central Bank

"Following the bursting of the real estate crisis of 2007 and the financial crisis of 2008, the European Union faced another difficult situation, namely the sovereign debt crisis, when the euro was put to the test. The sovereign debt crisis is a widely debated and analyzed topic both in Romania and in Europe. Given the effects it generates, amid rising government debt and the instability of the banking system, it is important to know its causes, in order to subsequently identify the most effective measures to improve the economic situation in each affected state. This paper seeks to discuss the concept of sovereign debt crisis by conducting an analysis of government debt sustainability and the budget deficit in the European Union, as well as a forecast of government debt sustainability in Romania, reflecting the measures implemented by the Central Bank EU. According to the Maastricht criteria, the nominal convergence indicators, including the budget deficit and government debt, must be below the alert level, so that they are in line with European Union requirements. The level of the consolidated budget deficit must be less than 3%, and in terms of government debt, it must be below 60% of GDP. The rationale for choosing this theme is that the existence of such a crisis at European level can significantly affect the economic context of each Member State of the European Union (EU), in terms of the interconnection of the global financial system. This interconnection refers to the idea that, when a state becomes involved in the claim of sovereign debt, it indisputably endangers part of the external private debt. This concept is also called in the literature and contagion effect. The relevance of this theme lies in the analysis of the evolution of the main indicators that led to the onset of the sovereign debt crisis, as well as in the identification of its causes, in order to prevent enlargement."

Macroeconomic instability and interest rate spreads in Ghana

AbstractThis paper investigates the extent to which interest rate spreads is associated with macroeconomic instability in Ghana. Using the Maastricht Criteria, quarterly data on inflation, budget deficit, prime rate, external debt and exchange rate were collected from 2008 to 2018 to construct a composite macroeconomic instability index. The resulting index was used to evaluate the long‐run and short‐run relationship between macroeconomic instability and interest rate spreads with the aid of the autoregressive distributed lag and bounds test approach to cointegration. The results revealed that macroeconomic instability had a positive long‐run and short‐run relationship with interest rate spreads. Non‐performing loans and loan‐to‐deposit ratio are found to be negatively related to interest rate spreads both in the short and long run, although the relationship is not statistically significant. From a policy‐oriented point of view, it is recommended that policy makers concentrate on managing macroeconomic instability as a means of boosting savings and investment.

Flaws in the European Monetary Union. Does the EMU Need a Solution?

Our study aims to reveal whether there are differences between the Eurozone and non-Eurozone countries in terms of their compliance with the variables established in the Maastricht criteria (inflation, public deficit, and public debt) to which we extend unemployment and the long term bond yields of countries that joined the common currency and those that did not. The results show that, in general terms, the non-compliance has been most hurtful in the Eurozone countries, especially in terms of deficit and unemployment.

Effective European monetary union in the light of the optimum currency area; model countries: Germany and Poland

PurposeThis study aims to research the effects of unemployment wages current account and consumer price index (CPI) on the real gross domestic product (RGDP), which, in the optimum currency area (OCA) theory, supposes that countries with higher factor mobility can significantly profit from the currency area. However, in this study, it is shown that the considered optimum currency crisis (OCC) model is affected by mobility factors, as the defined theory has not been perfectly realised in the Eurozone.Design/methodology/approachIn this study, Breusch–Pagan–Godfrey and Lagrange multiplier (LM) tests are used for supporting the survey for better estimation of the panel cointegration tests, where Pedroni's (1995, 1997) technique is used. The unit root tests are employed, of which the Phillip–Perron and augmented Dickey–Fuller tests (unit root test, Dickey, D. and W. Fuller, 1979) are considered.FindingsIt can be concluded that demand shocks will tend to be more asymmetric instead of being symmetric, even though they are in the customs union (CU). However, Polish workers in a given scenario may move to Germany, but because of the rigidity of the labour market and qualification differences between workers, the interregional integration of member countries is reduced, and this reduces the absorption of asymmetric shocks. In Germany, where strong employment protection and rigidity are observed in comparison to Poland, although there has been historical migration and economical collaboration, unfortunately, the integration of the two countries’ economies has not been realised.Research limitations/implicationsQuantitative research on fiscal union and the estimation of its effects is not possible because there is no practical experience of fiscal union throughout the European Union (EU). However, quantitative research is used for estimating the effects of OCA in the Eurozone. Quantitative investigation is particularly focused on the monetary union and single currency and its impact on growth rate. In this study, the ordinary least squares (OLS) method and panel cointegration test are employed for estimating the effects of the considered variables.Practical implicationsThe Eurozone and the application of a single currency throughout the EU was a considerably difficult task. In addition, the adoption of a single currency was not easy for those member countries that fulfilled the “convergence criteria” (or “Maastricht criteria”) and who joined the Eurozone, because only adoption is not enough; maintenance of those criteria is also required. This study analysed the application of the Eurozone in the light of the OCA of Mundel's theory.Social implicationsThe OCA is important for member countries’ economic relations. However, the application of a single currency is not easy and needs to be controlled and regulated to ensure best practises throughout the Eurozone. Monetary integration is not a simple process, and Eurozone countries’ financial difficulties affect each other’s markets’ indifferent aspects. Particularly in any market recession, demand shocks tend to have different effects. Furthermore, in comparison to the monetary union, the CU has a considerable impact on trade enlargement.Originality/valueIn this study, the effects of the independent variables “wages, unemployment, CPI and capital flow” on the dependent variable “RGDP” is considered, which, in the OCA theory, supposes that countries with higher factor mobility can significantly profit from the currency area. In application, it was turned into crisis because of inadequate monetary and fiscal application. In this paper OCA is questioned in the light of the Eurozone for bringing better understanding to these difficulties. The considered model and estimations are used for evaluating to create sustainable monetary integration for economic growth.