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Monetary unions and the problem of sovereignty

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Author Info
Robert A. Mundell () (Columbia University - Department of Economics)

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Abstract

Monetary integration involves a consideration of two quite different types or dimensions of sovereignty.One is policy sovereignty, and the other is legal sovereignty. Policy sovereignty refers to the ability to conduct policy independent of commitments to other countries. Legal sovereignty refers to the ability of a state to make its own laws without limitations imposed by any outside authority. Both concepts need to be considered in plans for monetary unions. What are the implications of a change in legal sovereignty when the national currencies of some of the oldest states in the world abandon national sovereignty, and what will they receive in exchange?

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File URL: http://www.econ.columbia.edu/RePEc/pdf/DP0102-06.pdf
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Paper provided by Columbia University, Department of Economics in its series Discussion Papers with number 0102-06.

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Length: 32 pages
Date of creation: 2002
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Handle: RePEc:clu:wpaper:0102-06

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