IDEAS home Printed from https://ideas.repec.org/h/spr/fimchp/978-3-319-17380-1_4.html
   My bibliography  Save this book chapter

The Legal Framework for the European System of Central Banks

In: Central Banking and Financial Stability in East Asia

Author

Listed:
  • Helmut Siekmann

    (Goethe University)

Abstract

The Treaty of Maastricht imposed the strict obligation to establish an economic and monetary union as an integral part of the EU. The single currency was to become the currency of the EU and the legal tender in all Member States unless an exemption was explicitly granted. Consequently, the primary law systematically only speaks of economic policy or monetary policy which is the task of the Eurosystem, consisting of the ECB and the central banks of the Member States whose currency is the euro. Although the national central banks of all the Member States together with the ECB constitute the European System of Central Banks, only the ECB is granted legal personality. General economic policy is not a task of the EU, but has been retained by the Member States. Exceptions have to be provided explicitly in the primary law. EU law, however, contains a host of rules to prevent excessive debt and deficits on the part of the Member States. Price stability has been set as the “primary objective”. The term has to be interpreted as close to zero per cent inflation. To safeguard the primary objective, a comprehensive guarantee of the independence of the ESCB, the ECB, and the members of its organs has been provided for. Exit from the Monetary Union while remaining a EU Member State is not possible. The introduction of a parallel currency is prohibited. If a new currency in substitution of the euro or parallel to it is introduced, all claims denominated in euro will remain in euro and, economically, the burden will most likely even increase.

Suggested Citation

  • Helmut Siekmann, 2015. "The Legal Framework for the European System of Central Banks," Financial and Monetary Policy Studies, in: Frank Rövekamp & Moritz Bälz & Hanns Günther Hilpert (ed.), Central Banking and Financial Stability in East Asia, edition 127, pages 43-86, Springer.
    • Handle: RePEc:spr:fimchp:978-3-319-17380-1_4
    DOI: 10.1007/978-3-319-17380-1_4
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Ludger Schuknecht & Philippe Moutot & Philipp Rother & Jürgen Stark, 2011. "The Stability and Growth Pact: Crisis and Reform," CESifo DICE Report, Ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(3), pages 10-18, October.
    2. Issing, Otmar, 2008. "The Euro: A currency without a state," CFS Working Paper Series 2008/51, Center for Financial Studies (CFS).
    3. repec:ces:ifodic:v:9:y:2011:i:3:p:16750160 is not listed on IDEAS
    4. repec:ces:ifodic:v:9:y:2011:i:3:p:10-17 is not listed on IDEAS
    5. Hal S. Scott, 1998. "When the Euro Falls Apart," International Finance, Wiley Blackwell, vol. 1(2), pages 207-228, December.
    6. Lastra, Rosa Maria, 2006. "Legal Foundations of International Monetary Stability," OUP Catalogue, Oxford University Press, number 9780199269341.
    7. repec:bla:intfin:v:1:y:1998:i:2:p:207-28 is not listed on IDEAS
    8. Ludger Schuknecht & Philippe Moutot & Philipp Rother & Jürgen Stark, 2011. "The Stability and Growth Pact: Crisis and Reform," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(03), pages 10-17, October.
    9. Thomas Eger & Hans-Bernd Schäfer (ed.), 2012. "Research Handbook on the Economics of European Union Law," Books, Edward Elgar Publishing, number 13923.
    10. Bitros, George C., 2013. "European Union failures in Greece and some possible explanations," MPRA Paper 45017, University Library of Munich, Germany.
    11. Helmut Siekmann, 2015. "The Legality of Outright Monetary Transactions of the European System of Central Banks," Financial and Monetary Policy Studies, in: Frank Rövekamp & Moritz Bälz & Hanns Günther Hilpert (ed.), Central Banking and Financial Stability in East Asia, edition 127, pages 101-123, Springer.
    12. James, Harold, 2012. "Making the European Monetary Union," Economics Books, Harvard University Press, number 9780674066830, Spring.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. John B. Taylor & Volker Wieland, 2016. "Finding the Equilibrium Real Interest Rate in a Fog of Policy Deviations," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 51(3), pages 147-154, July.
    2. Siekmann, Helmut, 2015. "The legality of outright monetary transactions (OMT) of the European system of central banks," IMFS Working Paper Series 90, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    3. Siekmann, Helmut, 2016. "Replacing or supplementing the euro in member states whose currency is the euro," IMFS Working Paper Series 109, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    4. Siekmann, Helmut, 2018. "Legal tender in the euro area," IMFS Working Paper Series 122, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    5. Siekmann, Helmut, 2015. "Exit, exclusion, and parallel currencies in the euro area," IMFS Working Paper Series 99, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Siekmann, Helmut, 2018. "Legal tender in the euro area," IMFS Working Paper Series 122, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    2. Siekmann, Helmut, 2015. "Exit, exclusion, and parallel currencies in the euro area," IMFS Working Paper Series 99, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
    3. Paul J.J. Welfens, 2012. "Towards a Euro Fiscal Union: Reinforced Fiscal and Macroeconomic Coordination and Surveillance is Not Enough," EIIW Discussion paper disbei191, Universitätsbibliothek Wuppertal, University Library.
    4. SIMIONESCU, Mircea & SAVU, Lucian, 2012. "Investigative Elements In The Principle Of Going Concern," Academica Science Journal, Economica Series, Dimitrie Cantemir University, Faculty of Economical Science, vol. 1(1), pages 19-28, November.
    5. repec:spo:wpmain:info:hdl:2441/eu4vqp9ompqllr09j0h0g8tgo is not listed on IDEAS
    6. Patricia Esteve‐González & Helmut Herwartz & Bernd Theilen, 2021. "National support for the European integration project: Does financial integration matter?," Economics and Politics, Wiley Blackwell, vol. 33(2), pages 357-378, July.
    7. Jerome Creel & Paul Hubert & Francesco Saraceno, 2012. "An assessment of Stability and Growth Pact Reform Proposals in a Small-Scale Macro Framework," Documents de Travail de l'OFCE 2012-04, Observatoire Francais des Conjonctures Economiques (OFCE).
    8. Nikki Panjer & Leo Haan & Jan P. A. M. Jacobs, 2020. "Is fiscal policy in the euro area Ricardian?," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 47(2), pages 411-429, May.
    9. Arce, Fernando, 2021. "Private Overborrowing under Sovereign Risk," MPRA Paper 113176, University Library of Munich, Germany.
    10. Chung-Fu Lai & Shan-Kai Tsa, 2015. "Diversified Currency Holdings and Exchange Rate Dynamics," International Journal of Economics and Financial Issues, Econjournals, vol. 5(3), pages 678-689.
    11. Thushyanthan Baskaran & Zohal Hessami, 2017. "Monetary integration, soft budget constraints, and the EMU sovereign debt crises," Economics and Politics, Wiley Blackwell, vol. 29(3), pages 252-275, November.
    12. De Jong, Jasper F.M. & Gilbert, Niels D., 2020. "Fiscal discipline in EMU? Testing the effectiveness of the Excessive Deficit Procedure," European Journal of Political Economy, Elsevier, vol. 61(C).
    13. Ian Schaeffer & Miguel D. Ramirez, 2017. "Is there a Long-Term Relationship among European Sovereign Bond Yields?," Business and Economic Research, Macrothink Institute, vol. 7(1), pages 68-86, June.
    14. Ion-Lucian CATRINA, 2012. "Governing European Union To Financial Stability," Scientific Bulletin - Economic Sciences, University of Pitesti, vol. 11(1), pages 35-42.
    15. Gulbahar UCLER & Hale KIRMIZIOGLU, 2015. "The Reasons of Eurozone Sovereign Debt Crisis and an Empirical Analysis over Permanency of the Crisis," International Journal of Economics and Financial Issues, Econjournals, vol. 5(1), pages 86-96.
    16. Luciano Andreozzi & Roberto Tamborini, 2017. "Why is Europe engaged in an inter- dependence war, and how can it be stopped?," DEM Working Papers 2017/06, Department of Economics and Management.
    17. Torój, Andrzej & Bednarek, Elżbieta & Bęza-Bojanowska, Joanna & Osińska, Joanna & Waćko, Katarzyna & Witkowski, Dariusz, 2012. "EMU: the (post-)crisis perspective. Literature survey and implications for the euro-candidates," MF Working Papers 12, Ministry of Finance in Poland, revised 06 Mar 2012.
    18. Jakob de Haan & Jeroen Hessel & Niels Gilbert, 2014. "Reforming the architecture of EMU: Ensuring stability in Europe," DNB Working Papers 446, Netherlands Central Bank, Research Department.
    19. Bergman, U. Michael & Hutchison, Michael M. & Jensen, Svend E. Hougaard, 2016. "Promoting sustainable public finances in the European Union: The role of fiscal rules and government efficiency," European Journal of Political Economy, Elsevier, vol. 44(C), pages 1-19.
    20. Tamborini, Roberto & Tomaselli, Matteo, 2020. "The determinants of austerity in the European Union 2010–16," The North American Journal of Economics and Finance, Elsevier, vol. 51(C).
    21. Dolls, Mathias & Peichl, Andreas & Zimmermann, Klaus F., 2011. "Eine Herausforderung für die G20: Global vereinbarte Schuldenbremsen und transnationale fiskalpolitische Aufsichtsgremien," IZA Standpunkte 45, Institute of Labor Economics (IZA).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:fimchp:978-3-319-17380-1_4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.