And it should be borne in mind – and this is one of the important lessons for countries engaging in a monetary union – that there are several national adjustment mechanisms to deal with idiosyncratic developments in a monetary union. These range from labour mobility, to flexible prices and wages to intra-union shifts in competitiveness.
Arguably, the most favourable condition for a monetary union would be a far reaching structural homogeneity of participating countries. But some instances of heterogeneity can realistically never be dismissed, and should not be. Otherwise the fruits of specialisation, comparative advantages and interregional risk-sharing cannot be earned in full.