Under a free market regime for money, higher time preferences would translate into higher real interest rates. By contrast, under the one-size-fits-all euro regime prices will tend to rise over-proportionally in areas with higher time preference, leading to decreased competitiveness.
A recent study by Prof. Eric Dor from the University of Lille documents the results in numbers – and clearly points to the culprit:
Since the launch of the euro, French and German industrial production growth numbers have diverged dramatically. French manufacturing production fell while German manufacturing production experienced strong increases. The decrease or stagnation of exports of French products contrasts with strong increases in German exports. France lost market share on foreign markets. This evolution is a direct consequence of the flaws of monetary union.
Before EMU, the rates of growth of French and German industrial production were close to each other. For example, from January 1995 to December 1998, the cumulative rate of growth was 5.5% for France versus 6.4% for Germany. By contrast, since the launch of the euro from January 1999 to April 2013 French industrial production decreased by 11.4%, while German industrial production increased by 32.8%!
Even before the financial crisis, during the period from January 1999 to December 2008, the divergence was obvious: French manufacturing production increased by a mere 3.4%, while German production increased by 32.4%. (slightly paraphrased)