Brexit and the controversy concerning an Irish border makes the issue of whether Northern Ireland is a common currency area with the rest of UK or the Eurozone topical. We test the microeconomic foundations of a common currency area for Northern Ireland, UK, Great Britain and Northern Ireland in the Eurozone. We provide evidence that all areas meet the microeconomic criteria for a common currency area. Banking data suggest that lending in Northern Ireland is different from lending in the rest of the UK, raising doubt on whether or not the UK forms a common currency area including Northern Ireland.
Bibliographical noteCopyright © 2023 Informa UK Limited, trading as Taylor & Francis Group. This is an Accepted Manuscript version of the following article, accepted for publication in The European Journal of Finance. Jane Binner, Sajid M. Chaudhry, James L. Swofford & Meng Tong (2023) UK or the Eurozone: which common currency area can work for Northern Ireland after Brexit?, The European Journal of Finance, available at https://doi.org/10.1080/1351847X.2023.2216240. It is deposited under the terms of the Creative Commons Attribution-NonCommercial License (https://creativecommons.org/licenses/by-nc/4.0/), which permits non-commercial re-use, distribution, and reproduction in any medium, provided the original work is properly cited.
- Economics, Econometrics and Finance (miscellaneous)