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Private ECUs: Unhappy triad

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  • European Monetary System
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Intereconomics

Abstract

The growing use of the European Currency Unit (ECU) in private transactions is often expected to produce a decisive impetus towards monetary integration within Europe. On the other hand, critics warn of the monetary risks of increased private use of the ECU. What are the opportunities and risks associated with the ECU? Is the importance of the ECU exaggerated at present?

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References

  1. For greater detail, see Bank for International Settlements, Fifty-sixth Annual Report (1985–86).

  2. Reproduced in ECU-Newsletter No. 15, January 1986, published by Instituto Bancario San Paolo di Torino.

  3. See Peter Bofinger: Verstärkte private Verwendung der ECU: Hindernisse, Chancen, Risiken, in: Wirtschaftsdienst, 1984, No. 9, pp. 448–454.

  4. See for example Jacques Delors: “Ce développement de l’Ecuprivé, il est spectaculaire”, Discours au Parlement Européen (20. 2. 1986), p. 429; and Heinrich Matthes: Das Europäische Währungssystem und die ECU, in: Wird die ECU die Europäische Währung der Zukunft?, Schriftenreihe der Schweizerischen Vereinigung für Währungsfragen, No. 3, May 1986: “The ECU basket has a potential that far exceeds its role as a mere ‘financial innovation’” (p. 15), and: “The importance of the ECU basket resides mainly in the fact that it promotes financial integration” (p. 21).

  5. For details, see Peter Bofinger: Is an ECU Parallel Currency the Way to Achieve European Monetary Integration?, in: INTERECONOMICS, 1985, No. 5, pp. 222 ff., and Peter Bofinger: Währungswettbewerb, Cologne 1985, pp. 117 ff.

  6. Alexander K. Swoboda: The Euro-Dollar Market: An interpretation, Essays in International Finance, No. 64, Princeton 1968.

  7. see Sven Grassmann: A Fundamental Symmetry in International Payments Patterns, in: Journal of International Economics, May 1973, pp. 105 f.

  8. See Ronald F. McKinnon: Money in International Exchange, New York and Oxford 1979, pp. 72 f.

  9. A good overview is to be found in Henry Schäfer: Begründungen einer internationalen Währung aus der Sicht der Geldtheorie, in: Geld und Währung, Vol. 2 (1986), pp. 24–35. See also Stanley W. Black: International Money and International Monetary Arrangements, in: R. W. Jones, Peter B. Kenen (eds.): Handbook of International Economics, Vol. II, Amsterdam, New York and Oxford 1985, pp. 1153–1193.

  10. Alec K. Chrystal: On the Theory of International Money, in: J. Black, G. S. Dorrance (eds.): Problems of International Finance, London and Basingstoke 1983, pp. 77–92.

  11. See also Peter B. Kenen: The Role of the Dollar as an International Currency, Group of Thirty, Occasional Papers, No. 13, New York 1983, p. 4.

  12. Bulletin de la Banque Nationale de Belgique, Le développement de l’ECU privé et la politique monétaire, April 1986, pp. 3–32, especially p. 29.

  13. See also Peter-W. Schlüter: Die ECU als Devise, in: Commission of the European Communities, Berichte und Informationen, No. 8, 22nd May 1984, p. 7.

  14. Helmut W. Mayer: Private ECUs, Potential Macro-Economic Policy Dimensions, BIS Economic Papers, No. 16 (April 1986). See also Norbert Kloten: The ECU: Prospects for Monetary Integration in Europe, in: The World Today, The Royal Institute of International Affairs, Vol. 41 (1985), pp. 179–183, especially pp. 181f.

  15. Helmut W. Mayer, op. cit. Private ECUs, Potential Macro-Economic Policy Dimensions, BIS Economic Papers, No. 16 (April 1986), p. 7.

  16. Helmut W. Mayer, op. cit. Private ECUs, Potential Macro-Economic Policy Dimensions, BIS Economic Papers, No. 16 (April 1986). p. 9; Norbert Kloten, op. cit. The ECU: Prospects for Monetary Integration in Europe, in: The World Today, The Royal Institute of International Affairs, Vol. 41 (1985), p. 181.

  17. Bulletin de la Banque Nationale Belgique, op. cit. Le développement de l’ECU privé et la politique monétaire, April 1986, pp. 17ff.

  18. Helmut W. Mayer, op. cit. Private ECUs. Potential Macro-Economic Policy Dimensions, BIS Economic Papers, No. 16 (April 1986), p. 8.

  19. Helmut W. Mayer, op. cit. Private ECUs. Potential Macro-Economic Policy Dimensions, BIS Economic Papers, No. 16 (April 1986), p. 17.

  20. Helmut W. Mayer, op. cit. Private ECUs. Potential Macro-Economic Policy Dimensions, BIS Economic Papers, No. 16 (April 1986), pp. 18 ff.

  21. See in this connection Norbert Kloten, op. cit. The ECU: Prospects for Monetary Integration in Europe, in: The World Today, The Royal Institute of International Affairs, Vol. 41 (1985), p. 181; see also Helmut W. Mayer, op. cit. Private ECUs, Potential Macro-Economic Policy Dimensions, BIS Economic Papers, No. 16 (April 1986), pp. 23 f.

  22. See Peter Bofinger: Geldpolitik im Zeichen der sogenannten Finanzinnovation, in: Sparkasse, Vol. 103 (1986), p. 142.

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  1. Landeszentrale in Baden-Würtemberg, Stuttgart

    Peter Bofinger

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Bofinger, P. Private ECUs: Unhappy triad. Intereconomics 21, 224–231 (1986). https://doi.org/10.1007/BF02926976

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