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Prospects for an EMU between Federalism and Nationalism

Listed author(s):
  • Frank A.G. den Butter

    (VU University Amsterdam, The Netherlands)

  • Mathieu L.L. Segers

    (Utrecht University, Utrecht, The Netherlands)

Which ways and means are available for the macroeconomic and fiscal coordination and/or integration within the EMU-framework? Which are the pros and cons of these scenarios? This paper combines economic theory, empirical analysis and insights regarding EMU’s institutional history in order to come to a compromise proposal for an EMU between nationalism and federalism. We take the present status quo acts as a starting point. We describe the tension between the arguments in economic theory on policy coordination and the way contagion can be avoided. In addition we assess the practical political implementation of these arguments. We sketch concrete options for a ‘deepening of economic coordination’ in the EMU, as announced by Van Rompuy in his 2013 London speech, without moving to a full-fledged federalist EPU.

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Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 14-008/VI.

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Date of creation: 09 Jan 2014
Handle: RePEc:tin:wpaper:20140008
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  1. John B. Taylor, 2012. "Monetary Policy Rules Work and Discretion Doesn't: A Tale of Two Eras," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 44(6), pages 1017-1032, September.
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  16. John B. Taylor, 2013. "The Effectiveness of Central Bank Independence Versus Policy Rules," Discussion Papers 12-009, Stanford Institute for Economic Policy Research.
  17. Erik Jones, 2010. "The Economic Mythology of European Integration," Journal of Common Market Studies, Wiley Blackwell, vol. 48, pages 89-109, January.
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