IDEAS home Printed from https://ideas.repec.org/a/taf/ecsysr/v28y2016i4p497-517.html
   My bibliography  Save this article

The European Monetary Union break-up: an economic experiment on the return of the deutsche mark

Author

Listed:
  • Anke Mönnig

Abstract

By using the macro-econometric input–output model INFORGE, this paper investigates the economic effects of a unilateral break-up of Germany from the European Monetary Union (EMU). The results show that a return to a national currency lowers Germany's growth path. Positive effects of a break-up due to lower domestic prices, increasing real wages and lower imports are fully compensated by the loss in international competitiveness. On industrial level, the negative implications are the strongest in those industries that depend strongly on exports. Strong indirect implications are expected for the business-related service sector. Although the results of this economic experiment depend strongly on its underlying assumptions, it can be shown that a break-up of the EMU would result in a heavy welfare loss for Germany.

Suggested Citation

  • Anke Mönnig, 2016. "The European Monetary Union break-up: an economic experiment on the return of the deutsche mark," Economic Systems Research, Taylor & Francis Journals, vol. 28(4), pages 497-517, October.
    • Handle: RePEc:taf:ecsysr:v:28:y:2016:i:4:p:497-517
    DOI: 10.1080/09535314.2016.1242478
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/09535314.2016.1242478
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09535314.2016.1242478?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lutz, Christian & Lehr, Ulrike & Wiebe, Kirsten S., 2012. "Economic effects of peak oil," Energy Policy, Elsevier, vol. 48(C), pages 829-834.
    2. Dirk Meyer, 2009. "Finanzmarktkrise und EURO-Zone – Gefahr des Zerfalls und Folgen des Austritts einzelner Mitglieder," Credit and Capital Markets, Credit and Capital Markets, vol. 42(2), pages 173-193.
    3. Scott, Hal S, 1998. "When the Euro Falls Apart," International Finance, Wiley Blackwell, vol. 1(2), pages 207-228, December.
    4. Philip Ulrich & Martin Distelkamp & Ulrike Lehr, 2012. "Employment Effects of Renewable Energy Expansion on a Regional Level—First Results of a Model-Based Approach for Germany," Sustainability, MDPI, vol. 4(2), pages 1-17, February.
    5. Hal S. Scott, 1998. "When the Euro Falls Apart," International Finance, Wiley Blackwell, vol. 1(2), pages 207-228, December.
    6. Christian Lutz & Bernd Meyer & Marc Ingo Wolter, 2010. "The global multisector/multicountry 3-E model GINFORS. A description of the model and a baseline forecast for global energy demand and CO 2 emissions," International Journal of Global Environmental Issues, Inderscience Enterprises Ltd, vol. 10(1/2), pages 25-45.
    7. Bernd Meyer & Christian Lutz & Peter Schnur & Gerd Zika, 2007. "National Economic Policy Simulations with Global Interdependencies: A Sensitivity Analysis for Germany," Economic Systems Research, Taylor & Francis Journals, vol. 19(1), pages 37-55.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Anke Mönnig, 2012. "Balancing the European Currency Union - an Impact Analysis on the Return of National Currencies," EcoMod2012 3831, EcoMod.
    2. Anke Mönnig, 2012. "Balancing the European Monetary Union - an Impact Analysis on the Return of National Currencies," GWS Discussion Paper Series 12-8, GWS - Institute of Economic Structures Research.
    3. John C. Soper, 2004. "European Labor Markets and Structural Reform : Does the Euro Have a Future?," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 20(Fall 2004), pages 112-124.
    4. Lars Jonung & Eoin Drea, 2010. "It Can't Happen, It's a Bad Idea, It Won't Last: U.S. Economists on the EMU and the Euro, 1989–2002," Econ Journal Watch, Econ Journal Watch, vol. 7(1), pages 1-4–52, January.
    5. Oleg V. Petrenko & Federico Aime & Tessa Recendes & Jeffrey A. Chandler, 2019. "The case for humble expectations: CEO humility and market performance," Strategic Management Journal, Wiley Blackwell, vol. 40(12), pages 1938-1964, December.
    6. Kibritçioğlu, Aykut, 2011. "Avro Bölgesi Ülkelerindeki Güncel Borç Krizi [Current Sovereign Debt Crisis in Eurozone Countries]," MPRA Paper 33528, University Library of Munich, Germany, revised 22 Aug 2011.
    7. Helmut Siekmann, 2015. "The Legal Framework for the European System of Central Banks," Financial and Monetary Policy Studies, in: Frank Rövekamp & Moritz Bälz & Hanns Günther Hilpert (ed.), Central Banking and Financial Stability in East Asia, edition 127, pages 43-86, Springer.
    8. Nikolay Nenovsky & Kalin Hristov, 2001. "Official Eurozation of Bulgaria: Pluses and Minuses," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 1, pages 64-80.
    9. Zoi Vrontisi & Ioannis Charalampidis & Ulrike Lehr & Mark Meyer & Leonidas Paroussos & Christian Lutz & Yen E. Lam-González & Anastasia Arabadzhyan & Matías M. González & Carmelo J. León, 2022. "Macroeconomic impacts of climate change on the Blue Economy sectors of southern European islands," Climatic Change, Springer, vol. 170(3), pages 1-21, February.
    10. Siekmann, Helmut, 2018. "Legal tender in the euro area," IMFS Working Paper Series 122, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    11. Cornelius, Peter K. & Trimbur, Thomas, 2000. "Heterogeneous policy responses and the risk of monetary disintegration in Europe," Research Notes 00-1, Deutsche Bank Research.
    12. Dirk Meyer, 2012. "A Roadmap for Exiting the Euro – Technical Preparation and Execution from the Viewpoint of the Exit Country," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 65(06), pages 22-27, March.
    13. Barry Eichengreen, 2010. "The Breakup of the Euro Area," NBER Chapters, in: Europe and the Euro, pages 11-51, National Bureau of Economic Research, Inc.
    14. Tholl, Johannes & Schwarzbach, Christoph & Pittalis, Sandro & von Mettenheim, Hans-Jörg, 2020. "Bank funding and the recent political development in Italy: What about redenomination risk?," International Review of Law and Economics, Elsevier, vol. 64(C).
    15. Eichler, Stefan, 2012. "Financial crisis risk, ECB “non-standard” measures, and the external value of the euro," The Quarterly Review of Economics and Finance, Elsevier, vol. 52(3), pages 257-265.
    16. Siekmann, Helmut, 2016. "Replacing or supplementing the euro in member states whose currency is the euro," IMFS Working Paper Series 109, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    17. Russell Cooper, 2012. "Exit from a Monetary Union through Euroization: Discipline without Chaos," NBER Working Papers 17908, National Bureau of Economic Research, Inc.
    18. Eichler, Stefan & Hielscher, Kai, 2012. "Does the ECB act as a lender of last resort during the subprime lending crisis?: Evidence from monetary policy reaction models," Journal of International Money and Finance, Elsevier, vol. 31(3), pages 552-568.
    19. Siekmann, Helmut, 2015. "Exit, exclusion, and parallel currencies in the euro area," IMFS Working Paper Series 99, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    20. Johannes Reinhard Többen & Martin Distelkamp & Britta Stöver & Saskia Reuschel & Lara Ahmann & Christian Lutz, 2022. "Global Land Use Impacts of Bioeconomy: An Econometric Input–Output Approach," Sustainability, MDPI, vol. 14(4), pages 1-24, February.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:ecsysr:v:28:y:2016:i:4:p:497-517. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CESR20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.