The Economics of Monetary Integration"This expositive textbook on monetary integration looks at the costs and benefits of monetary union in Europe. The author examines such topical issues as whether there is a good economic case for countries to have separate currencies, and whether a nation increases its welfare when it abolishes its national currency and adopts the currency of a wider area. This leads naturally to questions concerning the size of an optimal monetary area - should this include the EC, the whole of Europe, or the whole world?" "The first part of the book focuses on complete monetary unions in which a common currency is substituted for national currencies. The second part looks at incomplete monetary unions and analyzes the operation of monetary systems in which national monetary authorities maintain their national currencies but agree to fix their exchange rates. This leads to an analysis of the European Monetary System and also examines the issues relating to the transition to a full monetary system." "The book combines comprehensive exposition with discussion of recent historical events and theory and will prove invaluable to students."--BOOK JACKET.Title Summary field provided by Blackwell North America, Inc. All Rights Reserved |
Contents
Exchange Rate Uncertainty and Economic Growth | 5 |
Different Preferences of Countries about Inflation | 13 |
Growth Rates are Different | 25 |
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adjustment aggregate demand analysis asymmetric band of fluctuation Belgium budget deficits Bundesbank centre country chapter common currency credibility decline demand shock devaluation disinflation EC Commission 1990 EC countries economic agents effect Europe European central bank European Monetary System exchange rate uncertainty fast-growing countries fiscal policies fixed exchange rate flexible follows foreign exchange market form a monetary France French Giavazzi government budget deficits government debt government spending Grauwe growth rates high-inflation countries important incentive indifference curves inflation and unemployment inflation equilibrium inflation rate institutions interest rate irrevocably fixed Italy join a monetary labour unions lead low-inflation country Monetary Integration monetary policy money stock national currencies national moneys open economy optimum currency areas peripheral country Phillips curve problem rate of inflation reduce regime revenues risk seigniorage shift supply curve supply shock Suppose theory of optimum transaction costs unemployment rate unification upwards wage bargaining