Eurosceptics argue that had we been in the euro during the recent crisis, the effect on the UK's economy would have been catastrophic. Yesterday, David Davis, a senior Conservative MP, added his voice to that chorus in an article for the Evening Standard. It is a truism to say that had we joined in 2007 when the pound was exceptionally strong, we would be worse off now. Nobody, however, would have gone in at the wrong rate at the wrong time.

The question has to be: Would we be worse off now, had we joined in 1999? I don't believe we would have been.

Everything about the recent crisis was overwhelming and unexpected. It shattered the orthodoxies of the last ten years. The UK has limped out of recession with humbling growth of 0.1%.  We are the last major European economy to do so.

Equally unexpected, however, has been the resilience and stability of the euro amidst widespread financial mismanagement. Markets have flocked to it, making it the second largest reserve currency after the dollar, and non-members are queuing to join. Today, the euro accounts for about 26% of global currency reserves, whilst sterling only accounts for about 4%. 

Davis' first argument relates to flexibility. Now, flexibility sounds like a good thing to have - but what about stability? The question is, do we need more stability (the euro), or more flexibility (sterling)? What happened during the crisis begins to suggest an answer.

The euro has provided its members with a measure of stability and insulation from the volatility of the financial markets. It has reduced the cost of doing business and increased capital flows across member states' borders.

On the other hand, the pound and its flexibility has been found lacking.  Advocates of sterling say that devaluation is one of our most potent tools in a downturn.

The theory is that the value of the currency falls, making products more competitive, allowing us to export our way out of recession. The pound fell by an astonishing 30% between July and December 2008, levelling out at about 22% now, but the positive effect has been much less than many expected.The latest figures published by the Office of National Statistics show that volume of goods exported is still down by about 6% from pre-recession levels.

Furthermore, even when it does work, devaluation is highly flawed. Dominique Strauss-Kahn, head of the International Monetary Fund, recently warned that the world's leading economies shouldn't rely on exports to drive recovery. Devaluation is a short-term measure, usually followed by inflation (and boom and bust). Essentially, it is a cheap way of avoiding hard fiscal choices. It can't be reliably controlled and has the added disadvantage of weakening purchasing power.

Davis' second argument is about interest rates. Bank of England and European Central Bank rates have followed a similar pattern. The UK could have offset slightly lower ECB rates during the boom times with fiscal measures.

So how would the UK have fared had it been a member of the euro since 1999? First, it would have kept us honest. In the long run, we have to deal with a £178 billion budget deficit, and politicians of all parties must accept that severe spending cuts, and probably tax rises, are inevitable. Had we been in the euro, we would have had to deal with structural reform early, we would not have run up such an eye-watering debt and we would have benefited from far greater currency stability. Ireland, Greece and Spain, among the hardest hit, are being forced to make such difficult decisions. We would also have been far better equipped to deal with this crisis than these countries because we have a far more flexible labour market and economy.

Secondly, by removing exchange rate uncertainty and transaction costs, joining the euro would have boosted trade. Given that 52% of our trade is with other EU members, this would have resulted in significant benefits for the economy.

Thirdly, there would have been indirect benefits. As a major player within the eurozone, we would have been central in shaping forthcoming EU financial regulation, which is going to have a significant impact on the City.

In the EU, the UK is a large, influential country in a powerful regional bloc; in the world, an "independent" UK is a medium-sized country with little real power. Our banking sector is over-exposed and sterling is no longer a reserve currency.

No one can say with absolute certainty how the UK would have fared as a member of the euro, but it's time to stop treating sterling like a national treasure that needs to be protected, and start asking whether it is the right currency to foster prosperity in a global 21st century. In time, we may realise it is not.

Roland Rudd is senior partner at Finsbury and founding chairman of Business For New Europe