European Monetary Integration

The success of European monetary integration-what the editors of this CESifo volume call "one of the most far-reaching, real world experiments in monetary policy to date"-is not assured. Policy makers have been forced to deal with challenges posed by formulating a uniform monetary policy for countries with asymmetric business cycles and economies in different stages of development as well as with the fiscal and financial implications of a unified currency. The contributors to European Monetary Integration, all prominent economic analysts, combine theoretical modeling and policy recommendations in their examination of these difficulties. In the first three chapters, they consider issues raised by asymmetry problems, including imperfect labor and product markets, the problem of monetary policy objectives when "one size does not fit all," and the possibility of a bias toward smaller countries in the "one country, one vote" constitutional structure of the European Central Bank. In the last three chapters, they turn to fiscal concerns, including the distribution of seignorage revenues and the interaction of European Central Bank monetary policies and asset price dynamics. This volume offers an overview of the most pressing problems in European central banking, and should interest academic specialists as well as government officials and professionals concerned with central banking, international finance, and international trade.