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| How should large and small countries be represented in a currency union? Berger, Helge ; Müller, Till ; Universität <Berlin, Freie Universität> / Fachbereich Wirtschaftswissenschaft |
| Main title | How should large and small countries be represented in a currency union? |
| Author | Berger, Helge |
| Author | Müller, Till |
| Institution | Universität <Berlin, Freie Universität> / Fachbereich Wirtschaftswissenschaft |
| No. of Pages | 41 S. |
| Series | Diskussionsbeiträge des Fachbereichs Wirtschaftswissenschaft ; 2004/20 : Volkswirtschaftliche Reihe |
| Keywords | Central Bank, Federal Central Bank, currency union, optimal representation, voting, ECB |
| Classification (DDC) | 330 Economics |
| Also published in | |
| Abstract | The likely extension of the euro area has triggered a debate on the organization of the ECB, in particular on the apparent mismatch between relative economic size and voting rights in the Council. We present a simple model of optimal representation in a federal central bank addressing this question. Optimal voting weights reect two opposing forces: the wish to insulate common monetary policy from changing preferences at the national level, and the attempt to avoid an overly active or passive reaction to idiosyncratic national economic shocks. A perfect match between economic size and voting rights is rarely optimal, and neither is the one country, one vote princi- ple. Empirically, there are indications that the pattern of over- and under-representation of member countries in the ECB Council might be extreme by the standards of the US Fed and German Bundesbank and not always optimal. |
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| FU Department | Department Business and Economics |
| Year of publication | 2004 |
| Type of document | Book |
| Language | English |
| Terms of use/Rights | Nutzungsbedingungen |
| Created at | 2008-07-08 : 09:20:20 |
| Last changed | 2014-01-23 : 04:20:07 |
| Static URL | http://edocs.fu-berlin.de/docs/receive/FUDOCS_document_000000000459 |
| ISBN | 3-935058-90-X |
| Statistics | |
