Europe File

Scotland Fails U.K.'s 2 Political Tests

Without a Currency Union with the U.K., the Freedom an Independent Scotland Might Enjoy Would Be Limited

Feb. 16, 2014 4:47 p.m. ET

What makes for a successful currency union? The U.K. Treasury set out its views last week. Drawing on academic theory and the painful experiences of the euro zone over the past five years, it delivered its formal response to the Scottish government's proposal that Scotland and the rest of the U.K. should form a currency union should Scotland vote for independence in a referendum on Sept. 18.

Its answer to the Scots was an emphatic...

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