Lisnaja Kelmendi, Areti Stringa

Abstract: The aspiration of Albania to be part of European Union is based on political purposes, but most of all should be based on strong macroeconomic views and theories. Albania is a European country with an open developing economy. The road of economic integration should be built on strong efforts to achieve the required criteria as candidate member for joining a monetary union. To estimate Albania readiness to approach a common currency, empirical indexes serve to estimate if the country meets the Optimum Currency Area criteria’s. The model used by Horvath is seen favorable to estimate OCA index in Albania case. This approach helps to evaluate the conditions before a decision is made.

Key words: volatility; optimum currency area; variable; model; union; index; estimation