The Euro and the Battle of Ideas

Markus Brunnermeier, Harold James and Jean-Pierre Landau

VfS Annual Conference 2016 (Augsburg): Demographic Change from Verein für Socialpolitik / German Economic Association

Abstract: Book description: Why is Europe's great monetary endeavor, the Euro, in trouble? A string of economic difficulties in Greece, Ireland, Spain, Italy, and other Eurozone nations has left observers wondering whether the currency union can survive. In this book, Markus Brunnermeier, Harold James, and Jean-Pierre Landau argue that the core problem with the Euro lies in the philosophical differences between the founding countries of the Eurozone, particularly Germany and France. But the authors also show how these seemingly incompatible differences can be reconciled to ensure Europe's survival. As the authors demonstrate, Germany, a federal state with strong regional governments, saw the Maastricht Treaty, the framework for the Euro, as a set of rules. France, on the other hand, with a more centralized system of government, saw the framework as flexible, to be overseen by governments. The authors discuss how the troubles faced by the Euro have led its member states to focus on national, as opposed to collective, responses, a reaction explained by the resurgence of the battle of economic ideas: rules vs. discretion, liability vs. solidarity, solvency vs. liquidity, austerity vs. stimulus. Weaving together economic analysis and historical reflection, The Euro and the Battle of Ideas provides a forensic investigation and a roadmap for Europe's future.

JEL-codes: B26 E58 N14 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-eec, nep-his, nep-mac and nep-opm
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Citations: View citations in EconPapers (163)

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