Is there a case for a single currency for the South Pacific Islands

Abstract

This article examines the case for the Pacific island countries to adopt a single currency by establishing a currency union on the basis of optimal currency area conditions, pre-union trade patterns, asymmetric economic shocks, labour mobility and fiscal transfers. It indicates that the Pacific island countries which have recently decided to form a free trade area would prefer to await the full effects of trade liberalisation before forging higher forms of integration. Show more