Kenen was mainly concerned with short term transfers to smooth out cyclical bumpiness.

Peter Kenen argued in the late 1960 s that without exchange rate movements as a shock absorber, a currency union requires fiscal transfers as a way to share risk.

A logical corollary of the criteria set forth by Kenen and Obstfeld, and even of Mundell s labor mobility criterion, is that currency unions cannot survive without political legitimacy, most likely involving region wide popular elections.