Is there a “triffin dilemma” for the EMS?

Lorenzo Bini-Smaghi and Silvia Vori

Open Economies Review, 1993, vol. 4, issue 2, 175-188

Abstract: The question explored in this paper is whether the EMS can continue to perform efficiently and ensure low inflation in an economically and financially integrated area with a high degree of currency substitution. A dilemma may arise: on the one hand, currency substitution should be accommodated to provide market participants with the currency they desire; on the other, currency substitution should not determine an excess of liquidity in the system leading to inflation. These objectives might be difficult to reconcile in a system with decentralized asymmetric monetary policy cooperation such as the EMS and might have adverse consequences for the monetary stability of the system. Copyright Kluwer Academic Publishers 1993

Keywords: currency substitution; EMS; cross-currency holding; monetary policy cooperation (search for similar items in EconPapers)
Date: 1993
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1007/BF01000518 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:openec:v:4:y:1993:i:2:p:175-188

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/11079/PS2

DOI: 10.1007/BF01000518

Access Statistics for this article

Open Economies Review is currently edited by G.S. Tavlas

More articles in Open Economies Review from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().