In particular, as we well know, the euro area needs more flexible labour, product and services markets, which in turn means more active structural policies. What does this imply for the functioning of EMU? Three considerations apply in this respect.
First, neither the euro area as a whole, nor any major country in this area, nor larger economies such as the United States fully meet the Mundell criteria. In practice, it is almost impossible to find an optimal currency area - rather, this is a benchmark to be observed by the policymakers of each currency area.