This paper assesses the costs and benefits of monetary union in Europe. It is argued that neither the costs nor the benefits are in principle likely to be as great as critics and proponents respectively have suggested. Fiscal issues are, it is argued, likely to be far more significant. Fiscal...

Avocates of formal fiscal restraints on the member states of the European Monetary Union often argue that US experience proves that a monetary union needs such constraints to guarantee the stability of the common currency. We show, first, that the origin of formal fiscal restraints on US state...

We present new data documenting European capital issues in major financial centers from 1919 to 1932. Push factors (conditions in international capital markets) perform better than pull factors (conditions in the borrowing countries) in explaining the surge and reversal in capital flows. In...