ABSTRACT
This chapter includes an analysis based on the results of the theoretical and empirical research concerning the role and functions of the integration of financial markets in the monetary union. The chapter starts with the problem of the integration of financial markets as a criterion for joining the monetary union. Next, an analysis based on the theory and results of empirical research into the relationships between financial markets integration, business cycle synchronization and economic shock absorption mechanisms in the monetary union is carried out. The last part of the chapter addresses the issue of the effectiveness of a single monetary policy versus financial market integration.
