TY  - CHAP
U1  - Buchbeitrag
A1  - Herzog, Bodo
ED  - Bukowski, Sławomir Ireneusz
T1  - A monetary union without a fiscal union?
T2  - Monetary unions : background, advantages and disadvantages
N2  - This paper studies whether a monetary union needs a fical union in particular in the Eurozone. On 1 January 1999, despite controversial debates, the rule-based Economic and Monetary Union (EMU) started without a fiscal union. I show that there is weak economic convergence in the EMU since 18 years. In addition, I argue that a fiscal union does not solve the past disintegration failures.
I demonstrate that the major flaws are domestic policy failures and not institutional failures in the euro area. Consequently, establishing a monetary union without having a political union is a risky strategy. Indeed, the rule-based architecture of Maastricht is not guilty for the crisis alone. The root causes are the political flaws aligned with the rather weak enforcement of the rules. I propose a genuine redesign of the rule-based paradigm without a fiscal union. Yet a monetary union without a fiscal union works effectively if the rule enforcement is more automatic and independent of domestic and European policy-making.
KW  - fiscal union
KW  - rule-based architecture
KW  - economic governance
Y1  - 2018
SN  - 978-1-53614-250-1
SB  - 978-1-53614-250-1
SP  - 99
EP  - 118
S1  - 20
PB  - nova science publishers
CY  - New York
ER  -