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The long road to EMU: The Economic and Political Reasoning behind Maastricht

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  • Francisco Torres

    (IEE - Universidade Católica Portuguesa and INA)

Abstract

This paper aims to examine whether the economic and political reasoning behind Maastricht is consistent with earlier approaches to monetary integration. In doing so, it revisits the intellectual debate on monetary integration in Europe at different stages. It concludes that Economic and Monetary Union (EMU) as agreed at Maastricht reflected a compromise between two different but converging preferences, in the context of the experience of the European Monetary System (EMS) and other developments in national and European politics as well as in economic thought, on the role of monetary policy and institutions; the fall of the Berlin Wall may have added a new political dimension that might have made it easier to agree on the blueprint and on the calendar for the realisation of EMU. The various (political and economic) motivations for the convergence of initially different views on the role of monetary policy and successive interpretations of the objectives of EMU are discussed within the wider context of the process of European integration.

Suggested Citation

  • Francisco Torres, 2007. "The long road to EMU: The Economic and Political Reasoning behind Maastricht," Working Papers de Economia (Economics Working Papers) 50, Departamento de Economia, Gestão e Engenharia Industrial, Universidade de Aveiro.
    • Handle: RePEc:ave:wpaper:502007
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    References listed on IDEAS

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    1. Barro, Robert J. & Gordon, David B., 1983. "Rules, discretion and reputation in a model of monetary policy," Journal of Monetary Economics, Elsevier, vol. 12(1), pages 101-121.
    2. Torres,Francisco & Giavazzi,Francesco (ed.), 1993. "Adjustment and Growth in the European Monetary Union," Cambridge Books, Cambridge University Press, number 9780521440196, September.
    3. Paul Grauwe, 1996. "The economics of convergence: Towards monetary union in Europe," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 132(1), pages 1-27, March.
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    5. Francisco Torres, 2006. "On the efficiency-legitimacy trade-off in EMU," Working Papers de Economia (Economics Working Papers) 36, Departamento de Economia, Gestão e Engenharia Industrial, Universidade de Aveiro.
    6. Ivo Maes, 2006. "THE ASCENT OF THE EUROPEAN COMMISSION AS AN ACTOR IN THE MONETARY INTEGRATION PROCESS IN THE 1960s," Scottish Journal of Political Economy, Scottish Economic Society, vol. 53(2), pages 222-241, May.
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    8. Paul De Grauwe, 1993. "The Political Economy of Monetary Union in Europe," The World Economy, Wiley Blackwell, vol. 16(6), pages 653-661, November.
    9. De Grauwe, Paul, 1996. "Monetary union and convergence economics," European Economic Review, Elsevier, vol. 40(3-5), pages 1091-1101, April.
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    Cited by:

    1. Francisco Torres, 2007. "A convergência para a União Económica e Monetária: objectivo nacional ou constrangimento externo?," NIPE Working Papers 21/2007, NIPE - Universidade do Minho.

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    More about this item

    Keywords

    Economic and Monetary Union; Bretton Woods; European integration; Werner plan; European Monetary System; inflation; convergence of preferences; epistemic communities; currency crisis; monetary sovereignty; Maastricht treaty; convergence requirements.;
    All these keywords.

    JEL classification:

    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes

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