Abstract
On the 1st of January 1999, the euro went into circulation as a common currency for eleven of the fifteen European Union countries, with Greece joining in 2001. France joined in 1999. The ratification of the Maastricht treaty in November of 1993 provoked the creation of the European Monetary Union. Apart from making travel easier; this single currency makes very good economic and political sense. Indeed, using a single currency increases price transparency, eliminates currency exchange costs, and makes international and intra euro area trade easier. Therefore, it gives the European Union (and consequently France) a more powerful voice in the world. It is also a logical complement to the single market which makes it more efficient, now the EU can compete with the "Two bigs" (United States & Japan). The size and strength of the euro area also better protect France from external economic shocks, such as unexpected oil price rises or turbulence in the currency markets. However, the euro also has several drawbacks. All the countries belonging to the euro area are not equal in term of prices. The French economy is facing economic crisis and lower exportations since 2008. Why did the euro increase trade across borders within the euro zone? What are the main costs and benefits for the French economy?
