The Eurocrisis: Muddling Through, or On the Way to a More Perfect Euro Union? / Joshua Aizenman.

Format:

Book

Author/Creator:

Aizenman, Joshua.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w20242.

NBER working paper series no. w20242

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Eurocrisis

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2014.

Summary:

This paper looks at the short history of the Eurozone through the lens of an evolutionary approach to forming new institutions. The euro has operated as a currency without a state, under the dominance of Germany. This has so far allowed the euro to achieve a number of design objectives, and this may continue, as long as Germany does not shirk its growing responsibility for the euro's future. Germany's resilience and dominant size within the EU may explain its "muddling-through" approach towards the Eurozone crisis. We review several manifestations of this muddling through process. Greater mobility of labor and lower mobility of under-regulated capital may be the costly "second best" adjustment until the arrival of more mature institutions in the Eurozone.

Notes:

Print version record

June 2014.