Is there potential for monetary union outside Europe?

This chapter assesses the feasibility of monetary union in other parts of the world, other than Europe. The major issues examined in relation to forming a monetary union are national sovereignty, seigniorage revenues, uneven economic growth and stability of currency unions. Dollarization is considered as an alternative to and a catalyst for currency union in Latin America. This chapter concludes that monetary union is unlikely to come about outside Europe because of a lack of an institutional framework and commonality. In addition, economic shocks are unlikely to be dissipated symmetrically, which is a major requirement in currency union formation.