Germany and the other euro-zone countries: Considerable structural asymmetries despite small cyclical asymmetries

When the euro was formed, it was made sure that the economic cycles of Germany and the other euro-zone countries were similar. The concern was that cyclical asymmetries would make it difficult for these countries to use the same currency. But not much attention was paid to structural asymmetries. And there are considerable structural asymmetries between Germany and the other euro-zone countries: savings behaviours, structure of the economy, the economy’s level of sophistication. Structural asymmetries are just as much of a barrier to sharing the same currency as cyclical asymmetries, and yet it was above all the latter that were analysed prior to the euro’s creation .