Towards a stronger monetary union for The Netherlands

For many years now, a lot of economists have stated that the Economic Monetary Union (EMU) is not an optimal currency area (OCA). They argue that the EMU should be reformed. One way of doing this is by splitting it into two or multiple regions. This work aims to add to this discussion by being the first to quantitatively analyze which EMU countries The Netherlands could best form a currency area with. The criteria that are used to measure this are: similarity in economic structure, monetary policy coordination, openness to trade and labor mobility. These criteria are extracted from the OCA theory. This work shows that it would be most beneficial for The Netherlands to form a currency area with Belgium, Germany, France and Luxembourg, instead of staying a part of the current EMU. This emphasizes the importance of keeping the discussion on the viability of the EMU alive.