Submitted by Walmartpancake t3_zx7mc7 in explainlikeimfive
phiwong t1_j1yuqmx wrote
We don't have universal currencies because it would be very bad for many/most countries. One means that markets adjust for productivity, labor cost etc is through the exchange rate differences in different currencies.
If all countries shared the same currency, this "average" price will make labor in highly productive countries very cheap and labor in low/developing economies too expensive. This means super high unemployment and low investment into developing economies. The rich countries get richer and the poor countries get poorer.
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