Joseph Stiglitz, writing in The Guardian, had some thoughts on this. Noting the economic situation in the eurozone since the Panic of 2008 (my term, not his):
[T]he unemployment rate in the eurozone reached 10% in 2009 as well, and has been stuck in double digits ever since. On average, more than one out of five young people in the labour force are unemployed, but in the worst-hit crisis countries, almost one out of two looking for work can’t find jobs. Dry statistics about youth unemployment carry in them the dashed dreams and aspirations of millions of young Europeans, many of whom have worked and studied hard. They tell us about families split apart, as those who can leave emigrate from their country in search of work. They presage a European future with lower growth and living standards, perhaps for decades to come.
These economic facts have, in turn, deep political ramifications.
…there is one underlying mistake: the creation of the single currency, the euro. Or, more precisely, the creation of a single currency without establishing a set of institutions that enabled a region of Europe’s diversity to function effectively.
The hope was this:
Advocates of the euro rightly argue that it was not just an economic project…. More importantly, it was a political project; it was supposed to enhance the political integration of Europe, bringing the people and countries closer together….
Unfortunately, Stiglitz understates the magnitude of the error.
[F]or a single currency to work over a region with enormous economic and political diversity is not easy. A single currency entails a fixed exchange rate among the countries, and a single interest rate. Even if these are set to reflect the circumstances in the majority of member countries, given the economic diversity, there needs to be an array of institutions that can help those nations for which the policies are not well suited. Europe failed to create these institutions.
And so on.
However. There cannot be a single set of institutions that enabled a region of Europe’s diversity to function effectively; Europe is too diverse in political, social, even purpose of money philosophies for that to be possible. What’s necessary is a few smaller, differing currency zones connected by a free trade zone.