Real Wage Rigidities, Fiscal Policy, and the Stability of EMU in the Transition Phase. - EMU will start with eleven member countries as scheduled on January 1, 1999. The paper shows that the primacy of politics over economics in this decision could have serious consequences concerning the...

We analyze the similarities and the differences in the fragility of the European Monetary system (EMS) and the Eurozone. We test the hypothesis that in the EMS the fragility arose from the absence of a credible lender of last resort in the foreign exchange markets while in the Eurozone it was...

Chapter 1: Introduction -- Chapter 2: EMU’s Asymmetrical Institutional Design -- Chapter 3: Enhancing EMU’s Fiscal Arm: Towards Stronger Regulatory Surveillance -- Chapter 4: Building Central Financial Assistance Capacities -- Chapter 5: Developing an Emu Lending Of Last Resort Capacity --...