The European Integration has led to different effects on the people around the globe, and this made the Swedish government go on a referendum on the euro issue in the year 2003. The event was an extraordinary occurrence for various scholars of the European economic integration and unions that deal in monetary issues. Research on the referendum and subsequent solutions were documented by Vlachos Jonas and Jonung Lars and the publication was dubbed “The euro – what’s in it for me, An Economic Analysis of the Swedish Euro Referendum of 2003”. This paper presents the publication, its relevance, strong points, weak points and areas of improvement.
Jonung and Vlachos confirm that the citizens from Sweden had a choice between maintaining their normal currency, and the use of the euro. The European Union makes use of the euro as their single currency, hence the main idea of including Sweden in its use. The voters were supposed to indicate an NO or YES in the referendum to denote their acceptance or refusal for the euro use. There were however various divisions that were significant in different areas like location, education, industrial structure, income, employment and sex (55).
The purpose of the publication was to consider the various behaviors that often exist between voters. The analysis of the results from the referendum was based on the OCA approach. The approach was used to close the gap between the reduced costs of transactions after entering the euro zone, which ensures and increases income and trade capabilities. The voters were also informed that they would have a macroeconomic advantage, which will make them have domestic currency that has an exchange rate that is flexible. The idea however attracted different reactions from the voters who made different evaluations that pertained to the risks, costs and benefits of making use of the euro as opposed to the krona, which was their domestic currency.
The OCA approach was advantageous to the study as it provided various hypotheses that concerned the behaviors of voters during the referendum. It helped in the econometric tests that were from the polls of more than 10,000 respondents. The OCA approach is often important and regarded when making inferences into predicting the behaviors of voters in a research work. The approach proved that the respondents were able to make clear justifications of the benefits and costs of the euro inclusion into Sweden. Most of the voters did vote effectively after answering the question “What’s in it for me?” in accordance to the topic of the publication.
There were two camps from the referendum that was for and against the referendum. The Yes group did stress on the various benefits that could be attained by the euro inclusion. The majority of them confirmed that there was going to be an increase in competition, employment, economic growth and trade with a decrease in the rates of interest. The No group on the other hand emphasized on various economic issues, and particularly stressed the value of using a national bank, which could target the rate of inflation, with the aim of having a floating exchange rate, and this would pull Sweden from different shocks from the country.
There research made use of two different types of data, and this were divided between the municipalities and the individuals. In the individual data sets, a probit model was used, and this helped the researchers to make predictions of various voting capabilities, either No or Yes to the use of the euro. The municipal level was aggregated and various determinants done on the share of votes from the voters using least squares. The research also made of two different data sources that are the exit poll data and regional data. The results of the research indicated that the respondents’ decisions were based on their economic position. Al voters who earned fully from the public sector were not ready to join the euro membership while those in the private sector found it intriguing enough to warrant a try.
The paper was relevant from its literature and all the research objectives were clearly met. The question of joining the euro membership by the respondents from Sweden was the first one to be done though there are other research works that have dealt with the issues that pertain to the European integration and the euro. The research is therefore similar to others that have been done in the past only that this one had a different sample size and population, who were from a different area.
In conclusion, the paper is consistent with its arguments and ought to be published because it clearly indicates that the reason for choosing or denying the use of the euro stem from the economic considerations of respondents. This is a vital tool that can always be used by researchers when providing hypotheses for their works in economics. The paper is perfect and lacks limitations drawbacks that need changes. This is because it provides similar variables that are often used in other nations when issues of integration are at play.
Jonung Lars, and Vlachos Jonas. “The euro – what’s in it for me? An Economic Analysis of the Swedish Euro Referendum of 2003” International Organization 61.04 (2007): 1-80. Print.
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