"The German economy has hugely benefited from a cheap euro. This has fueled its export-driven economy, and the country has racked up a huge trade surplus. [...]

"The German economy has hugely benefited from a cheap euro. This has fueled its export-driven economy, and the country has racked up a huge trade surplus. [...] Germany has benefited from a cheap exchange rate and is running trade surpluses that are more than 6% of GDP." "Many of the benefits of European integration came from the harmonization of regulations and the steps that were taken to facilitate cross border movement of goods, services and people. My work [...] shows that there is little or no impact when the euro is introduced." He explicitly says that the Euro does not contribute to removing the barrier. He's saying that the fact that countries with trade deficits have pressure to devalue their currencies contributes to a country like Germany with a trade surplus not revaluing its currency when it might otherwise have done so. Edit: Quote from the abstract of his paper: "The Euro adoption as well as the anticipation of the Euro adoption has minimal effects on market integration." The paper goes into more detail and is freely downloadable. In particular he says that there is a small effect from the Euro introduction in his regression model, but that it is much less significant than EU membership in explaining correlation between valuations of similar companies in different countries. The "anticipation of the Euro adoption" is intended to counter the possibility that integration due to preparation for Euro adoption might harmonise the valuation figures prior to actual adoption. I'm a bit suspicious of the arguments he lays out for the lack of a Euro effect on integration of economies within the EU, especially in the light of his article. The paper claims: "In addition, ex ante we would expect the process of economic market integration to be more important for equity valuations than the adoption of a single currency. This is because currency movements account for only a small part of the total variation in equity returns and the variability of intra-Europe exchange rate changes before 1999 was quite limited." So here he's arguing that Europe exchange rates before the Euro didn't change significantly relative to each other, and using this to argue that other factors are more important for market integration than the currency. If that's the case you might then expect that getting rid of the Euro would equally have very little effect. It seems he wants to have it both ways: the introduction of the Euro has little effect on market integration, but getting rid of it would decrease harmful effects of market integration. In general he tries hard to tease out the correlation versus causation in integration effects due to introduction of the Euro, but some of his arguments seem a little arbitrary, for example, the Euro affect that he observes is statistically explained away by introducing a "distance from Brussels" control and a "foreign language spoken" control. I could well be misunderstanding, but I think the significance of these controls needs more explaining to make his case convincing. This is the point where a lot of free time and access to the secondary literature would become helpful...