• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Outline the arguments for not joining the Euro.

Extracts from this document...

Introduction

Outline the arguments for not joining the Euro. There are numerous arguments that the British government have recognised outlining their decision in not joining the Euro. If Britain joined the euro they would only be one voice out of twelve countries, meaning less influence on policies. Once Britain signs for the euro they would be joined into an irreversible agreement. Many European countries have a desired goal of joining to create a 'United States of Europe' which would involve the submission of Britain's sovereignty and subsequently their global independence as a currency. The British public have voiced their enthusiasm towards having a more localised political management system. The introduction into the Euro means that the political powers of electorates would not be as strong on a local scale if the interests of mainland Europe were to be influential as well. It would create almost a disenfranchisement of political power in Britain away from a local level and more towards a national level. We only have to look at the poor turnout in Britain at the elections for the European parliament to see the disinterest that people have about joining. ...read more.

Middle

In recent years the Bank of England has proved very successful at controlling inflation making Britain no longer the high-inflation capital of Europe, but having a similarly low level to Germany and France. Britain's economy is so out of step with other mainland Europe countries that it would only be to our disadvantage join. One reason why our economy is out of step to that of mainland Europe is partly because we have much closer ties to North America than they do. More than half our trade goes outside Europe, and most of our trade is done in dollars. Over the past three economic cycles the British economy has been seen to be more similar to that of North America than with Europe. Evidence of this is that since the pound fell out of the exchange-rate mechanism in 1992, it has remained relatively stable against the dollar, but very volatile against European currencies. However, the euro has been very volatile against the dollar, so locking the pound to the euro would actually mean more currency instability for the majority of exporters, not less. In contrast, countries on the European mainland do a higher proportion of trade with each other, and their economies are far more integrated. ...read more.

Conclusion

Euro countries will economically progress as a team due to a more integrated trading pattern between them, resulting in greater competition between the different countries companies and providing a greater incentive to invest across boarders. Britain on the other hand will be left on the edge of Europe with a loss of support and trade from its closest trading allies. To conclude with I would say that the positive aspects of deciding to stay an independent currency would be a sensible decision in an attempt at keeping the British economy as stable as it is at present. I think that joining a 'one size fits all' interest rate could only do more harm than good, especially on this large a scale of an operation. If other Euro countries were to be in recession and interest rates were fixed to aid these countries then it would be our economy that would suffer as a result. The time and effort involved in changing currency will be wasting our attentions towards more vital aspects that need attending too such as the NHS. If we were not to join though we may be left out of what could be a globally dominating currency in future years to come. The Euro can only really strengthen over time, especially with internal trade between Euro countries made easier with the single currency. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE Economy & Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE Economy & Economics essays

  1. UK Membership of the European Monetary Union.

    The UK will have to decide whether it is important to have considerable influence on the future or whether they would rather stay out of it. The power to print money, inflate, and boost exports by devaluation, is now being created in the most powerful way possible - by treaty.

  2. Economics of European Integration

    way to produce a good and to maximise the welfare of the society. Although this economic rule theoretically also makes sense for network industries, the common governments' opinion was that the electricity industry needed to be well regulated or even public owned to achieve the maximisation of the society's welfare.

  1. Do the Benefits of Joining the Euro Outweigh the Disadvantages?

    As with decimalisation in 1971, converting to a new currency offers an opportunity to retailers to round up prices and take advantage of the confusion. The depreciation of the pound required to secure entry at a viable exchange rate would also cause import price inflation.

  2. THE UK AND THE EURO

    This is a disadvantage to UK economy and businesses. 9. Inward investment In every economy, there is always foreign investment. Some major foreign investors have refrained from investing in the UK Since she has continued to stay out. The employees and steel users are of the same opinion too.

  1. What are the Academic arguments for and against public body regulation

    For years this proved very profitable until interest rates increased beginning in 1966 and thus the S&P's were left with a mismatch. i.e. instead of earning money they were now losing it. Instead of increasing their reserves the managers simply ignored it and did not adjust for it in the P&L or Balance Sheet.

  2. Scarcity and Unlimited Wants.

    Movements Along and Shifts in Supply Curves A change in price never shifts the supply curve for that good. In the diagram below an increase in price results in a movement up the supply curve. The increase in quantity supplied from Q1 to Q2 is sometimes called an expansion in supply.

  1. The Quest for Optimal Asset Allocation Strategies in Integrating Europe.

    data, they find that more recent data convey a radically different message. They find that the period after the introduction of the euro is characterised by lower correlations than those obtained for the immediately preceding period of the same length.

  2. Investigate if the UK would benefit by adopting the single currency, and if so ...

    integrated single European Economy as buying from a company in a fellow Euro zone country is exactly the same as buying from a company in your own country. This is called price transparency: it will become far easier to compare prices across the markets of the Euro zone.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work