Should the UK join the euro zone?

A question from Yahoo! Answers:

What would happen if UK join the European Union i mean their currency?

Britain would not have an independent monetary policy. Whether this is good or bad depends on how much the British economy is in sync with the continent and to what extent the British economy responds to external shocks in a way similar to that of continental countries.

Personally, I think that joining the Euro zone would be a mistake, since Britain is much less susceptible to oil price shocks than France, Germany, or Italy. On the continent, increasing oil prices call for expansionary monetary policy; in Britain, the expansion may not be necessary, since Britain is largely self-sufficient when it comes to oil.

In my opinion, Britain should look to Norway for inspiration. Norway has even less incentive to join the Euro zone, and for the same reason. Periods of high oil prices that are a scourge of Europe are periods of high prosperity for Norway. Norwegian monetary policy, consequently, has to run contrary to that of the Euro zone, so there is no talk of Norway joining the Euro zone…

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