Optimum currency area theory in connection with Greek crisis

Bachelor thesis is focused on economic crisis in Greece with concentration on its political and social consequences, that were caused by unreadiness of Greek economy to enter eurozone. Common currency is very topical in all countries of the European Union. According to many European politicians, euro is an instrument serving to connect and bring together economical and cultural relationships within Europe, therefore considered as the foundation for European future. However, author of this thesis offers an alternative idea. The paper researches social, economicj and political consequences of adopting common currency in economically unprepared Greece. Perhaps euro is not a common denominator of European future, but rather its biggest threat. In three chapters theory of optimum currency areas (OCA) is explained, index OCA designed by Bayoumi and Eichengreen is then used to prove unreadiness of Greek to adopt euro, and finally, social, political and economical consequences are researched. Among the most serious consequences revealed are rapid rise in right-wing extremism as well as rapid rise in suicide rate. Grave economical problem is quick drop in international competitiveness ranking. The paper offers base for further econometric analysis and very unique perspective on a greek economical crisis. Idea can serve as valuable argument in a question of european economic integration.