Transition Issues for the European Monetary Union

Willem Buiter and Anne C. Sibert

No 6292, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: If Stage Three of EMU starts on January 1, 1999, transition issues remain on two time scales. Until July 1, 2002, national currencies and the euro co-exist as legal tender. We argue that intra-EMU currency risk exists in principle during that period, but that no EMU member can be forced out through speculative attacks. Cohabitation of Ins and Outs has an open-ended time scale. We discuss the effect of EMU on incentives for both Ins and Outs to undertake structural reform and the coordination problems associated with the distribution of seigniorage revenue and the Stability and Growth Pact.

JEL-codes: F31 F33 (search for similar items in EconPapers)
Date: 1997-11
Note: IFM
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Citations: View citations in EconPapers (6)

Published as DeEmu in Breed Perspectiet; Preadviezen 1997, Koninklijke Vereniging voo rde Stathuishoudkunde, pp. 1-17; Lemma BV, Utrecht, 1997.

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