Does the eurozone represent an optimal currency area?

This bachelor thesis examines whether the Eurozone constitutes an optimal currency area in accordance with the theory of optimal currency areas (OCA). The theoretical part analyses key OCA concepts and their development and describes the history of the formation of the Eurozone, including its internal mechanisms. The practical part addresses two hypotheses. The first hypothesis states: "The Eurozone forms a monetary area fulfilling the OCA criteria comparably to the monetary area of the USA," which showed that the Eurozone is comparable to the USA in terms of economic production diversification, although the mobility of workers in the Eurozone is evaluated as insufficient compared to the USA. The second hypothesis states: "The criteria of the OCA theory are of an endogenous nature and entry into the monetary union affects the fulfilment of these criteria." The analysis, conducted using Difference-in-Differences models to determine the trends of compliance before and after entering the Eurozone, confirms that the adoption of the euro has a statistically significant impact on worker mobility, and a statistically significant impact was also found on the diversification of economies in one of the four models, its results suggest a reduction in economic diversification after their entry into the monetary union. Given the diversity of criteria, it is not possible to answer unequivocally yes or no to the question posed in the title of the thesis, "Does the Eurozone represent an optimal currency area?" Author concludes that the biggest issue of eurozone from the OCA point of view is meeting the requirements in terms of labour mobility.