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In or Out: The Effect of Euro Membership on the Exercise of Real Business Options

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  • Tom Aabo
  • Christos Pantzalis, University of South Florida, United States

This empirical study of manufacturing firms (NAICS 33) in the EU15 countries goes beyond the trade statistics that have indicated only a small to negligible effect from the introduction of the Euro and shows that the introduction of the Euro has made Euro firms (firms based in one of the twelve Euro countries) more inclined than non-Euro firms (firms based in one of the three non-Euro countries: UK, Sweden and Denmark) to undertake various forms of real actions (exercise real business options) such as to establish alliances / partnerships, to enter new markets / market segments, to switch suppliers, and to generally expand in the Euro-area. The results are important in understanding the potential long-term effects of Euro membership.

Original languageEnglish
JournalEuropean Journal of Finance
Pages (from-to)259-284
Publication statusPublished - 2011

    Research areas

  • Euro membership, real business options, long-term effects, manufacturing firms

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