The paper presents the development of the role of the ECU in the financial markets. The ECU is the only currency basket to have developed as a currency. It has gained popularity for several reasons. In the early 1980s, the most important reason was that it offered a simple, easy and inexpensive...

International money is used as a medium of exchange, as a unit of account, and as a store of value.These roles can be performed either in the private or in the public sector of the economy.In order to be considered in the decision making of international agents, the currency must fulfil some...

This study is concerned with the determinants of monetary policy in the ERM countries.We derive a monetary policy rule, an interest rate rule, from a minimization problem faced by the central bank. The loss fuction trades off costs of interest rate instability against benefits from successful...

The study deals with the international transmission of economic shocks, their consequences for exchange rates and the reconciliation of exchange rate management with monetary policy. The theoretical part of the study consists of a mainstream model of two large, interdependent economies with...

The purpose of this study is to analyze realignment expectations in the exchange rate mechanism of the European Monetary System (EMS), in particular with reference to the five year period (1987-1992) during which no realignments were done.The period chosen for this study provides us an...

This study, "Exchange Rates in European Monetary Integration", is an empirical contribution to exchange rate theory and international monetary cooperation.The first essay, "Realignment expectations in the ERM: 1987-1992", studies the five-year period of convergence and stability in the European...