Citation

Discussion Paper Details

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Full Details

Title: Designing a Central Bank for Europe: A Cautionary Tale from the Early Years of the Federal Reserve System

Author(s): Barry Eichengreen

Publication Date: November 1991

Keyword(s): ECB, Federal Reserve System, Monetary Policy and Open Market Operations

Programme Area(s): International Macroeconomics

Abstract: Important questions concerning the structure and operation of a European Central Bank remain unanswered. Although there exists no precedent for the process of institution-building in which the European Community is currently engaged, the founding and early operations of the Federal Reserve System in the United States provide a suggestive parallel. The US experience suggests that Stage 2 of the Delors Plan contains potential sources of instability and provides an argument for direct transition from Stage 1 (national monetary autonomy) to Stage 3 (centralization of authority). It also suggests the need for more thought about voting and mediation procedures to be used to reconcile and aggregate national interests.

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Bibliographic Reference

Eichengreen, B. 1991. 'Designing a Central Bank for Europe: A Cautionary Tale from the Early Years of the Federal Reserve System'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=585