This paper describes the financial innovations hypothesis that M1, but not M2, has been significantly affected by the introduction and growth of these new assets. An alternative hypothesis, called the competitive markets hypothesis here, has implications that are nearly the opposite of the...

A central hypothesis and concern of some skeptics of European monetary union is that monetary policy coordination to secure a peg to the Gennan mark (DM) will tie real economic performance, especially the unemployment rate, to that in Germany. Evidence on this hypothesis can be found in Austria,...