Melitz, J. (2014) “Why Europe Needs Two Euros, Not One“, VoxEU Organisation, 02 Ιουλίου.
As the Eurozone cautiously implements stabilising reforms, Germany is forced to go further with concessions than it would prefer. This column suggests that it would be beneficial for discontented members to consider the formation of a second monetary union. The second euro can be constructed better than the first, bringing the discontented members exchange-rate adjustments relative to Germany, and avoiding competitive devaluations.
One basic feature of the sickly situation in the Eurozone today is that the system does not clearly bear any essential flaw from the standpoint of Germany. All things considered, the country has not done badly since the Great Recession of 2008-2010. And as the Eurozone moves forward gingerly with necessary reforms in order to avoid a break-up of the system, it is evident that Germany is constantly under pressure to go further with concessions than it would prefer.
In these circumstances, it may be time for radically new thinking. I would like to propose that the discontented members would do well to consider seriously the formation of a second euro. Such proposals have been made (Dobbs and Spence 2012), but the lingering unsatisfactory macroeconomic conditions seems to call for a rethink.
Σχετικές αναρτήσεις:
- Walker, M. (2014) “Europe Is Closely Studying Lessons from Japan – They Fear Euro Zone Is Falling Into Similar Lethargy“, The Wall Street Journal, 29 Ιουνίου.
- Auer, R. (2014) “The increasing competiveness of the southern Eurozone“, VoxEU Organisation, 11 Απριλίου.
- Bagus, P. (2010) The Tragedy of the Euro, Mises Institute.