Webbläsaren som du använder stöds inte av denna webbplats. Alla versioner av Internet Explorer stöds inte längre, av oss eller Microsoft (läs mer här: * https://www.microsoft.com/en-us/microsoft-365/windows/end-of-ie-support).

Var god och använd en modern webbläsare för att ta del av denna webbplats, som t.ex. nyaste versioner av Edge, Chrome, Firefox eller Safari osv.

Jonas Ljungberg. Foto.

Jonas Ljungberg

Professor emeritus

Jonas Ljungberg. Foto.

Asymmetric trends and European monetary policy in t he Post-Bretton Woods Era

Författare

  • Tony Johansson
  • Jonas Ljungberg

Summary, in English

In public debate the crisis of the eurozone has been laid on the footstep of imprudent government finance. This paper argues that the depth and longevity of the crisis instead is due to ‘asymmetric trends’ that are inherent in the eurozone. We show this, first, by a test of the ‘one-size-fits-all’ ECB monetary policy. The results provide an estimate of how ECB at the same time fuelled some ‘bubble economies’ and put on a deflationary pressure in other economies. Second, we measure how the higher inflation rate in the periphery eroded its international competitiveness under the restriction of the ‘irrevocably fixed exchange rates’. This is compared with the development during the preceding half century and periods with more flexible exchange rates. Before the EMS crisis of the early 1990s, the EMS had its ‘soft’ and its ‘hard’ phase. During the ‘soft’ phase, so called realignments of exchange rates adjusted for diverging trends in inflation and competitiveness. The ‘hard’ phase ended with the relaxation of the narrow band for the exchange rates. Again, a ‘soft’ phase followed until the ‘irrevocably’ fixing of the exchange rates that launched the euro. The catch-up and convergence of incomes within Western Europe have been largely enhanced by exchange rate adjustments. A pendulum between ‘soft’ and ‘hard’ phases have characterized European monetary policy and significantly conditioned European economic growth. A bottom line is that, ironically, the Maastricht aim of further integration actually is counteracted by the economic mechanisms of the monetary unification.

Avdelning/ar

  • Ekonomisk-historiska institutionen

Publiceringsår

2013

Språk

Engelska

Publikation/Tidskrift/Serie

Lund Papers in Economic History

Issue

128

Dokumenttyp

Working paper

Förlag

Department of Economic History, Lund University

Ämne

  • Economic History

Nyckelord

  • euro
  • monetary policy
  • exchange rates
  • fiscal deficit

Aktiv

Published

ISBN/ISSN/Övrigt

  • ISSN: 1101-346X