Northern Light: Does Optimal Currency Area Criteria Explain Nordic Reluctance to Join Emu?

Finland was the only Nordic country to join the European Monetary Union (EMU) when it began on January 1, 1999. In the autumn of 1994, the voters of Sweden and Finland decided to join the European Union (EU), while those in Norway decided to remain outside. In Denmark, the voters had earlier decided not to join the single currency area but othewise remain a fully-integrated member of the EU. Denmark, however, maintains the option of having another voter referendum. The government of Sweden decided on a similar course, in essence reneging on the commitment made when voters accepted the Maastricht Treaty, by announcing in Spring 1997 that it would not be among the first group of EU countries forming monetary union. Only Finland committed to EMU membership at the outset.