Does the common currency promote goods market integration within the EMU? We argue that such an effect is likely, but that the mechanism typically proposed lover costs of arbitrage because of increased price transparency is likely to be of minor importance. Instead we sketch a duopoly model...

This report, commissioned by Sveriges Riksbank, examines the role of currency denomination in international trade transactions. It is divided in two parts. The first part consists of a survey of the price setting and payment practices of a large sample of Swedish exporting firms. The second part...