The Prospect of a Depreciating Dollar and Possible Tension Inside the EMS
AbstractThe depreciation of the dollar can lead to conflict within the European Monetary System. In order to develop this theme, I assume that the preferences of German policy-makers are more strongly anti-inflationary than those of the French. This means that the depreciation of the dollar will suit the Germans better than the French. Consequently, a dilemma can arise, wherein no possible realignment can resolve the conflict between France and Germany. Only a return to the conditions of the "snake" will do. That is, France may need to accept a situation where it bears exclusive responsibility for defending the jointly determined parity. But it may not be in the interests of the French nor even, possibly, those of the Germans for France to do so.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 97.
Date of creation: Mar 1986
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- Jacques Melitz, 1988. "The Prospect of a Depreciating Dollar and Possible Tension Inside the EMS," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 124(I), pages 1-21, March.
- Jacques Melitz, 1986. "The prospect of a depreciating dollar and possible tension inside the EMS," International Finance Discussion Papers 279, Board of Governors of the Federal Reserve System (U.S.).
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- Ulrich Camen & Hans Genberg & Michael Salemi, 1991. "Asymmetric monetary policies? the case of Germany and France," Open Economies Review, Springer, vol. 2(3), pages 219-236, October.
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