In no other area has European integration advanced as much as in the monetary sphere. By joining the European Economic and Monetary Union (EMU), 17 countries of the European Union have given up their national currencies and their monetary sovereignty and have created a common monetary area with a joint central banking system (Euro system) and a common European currency (Euro). With the introduction of euro notes and coins Europe also got a strong common symbol. At the same time, the US dollar received a competitor for its role as the dominant international currency. The financial, economic and debt crisis has revealed fault lines in the design of EMU. Reforms to address these issues have been undertaken. However, many observers think more radical reforms are necessary. In this sense, EMU has moved center stage in EU’s on-going evolution and further integration.
The course aims at providing students with in-depth knowledge of institutional and economic issues related to EMU, so that they can form their own views on this and related topics. Former students appreciated the topicality of this course and its close correspondence to issues discussed in the political and financial community.
The course will cover the following topics:
- Stages, history and rationale of monetary integration in Europe
- Costs and benefits of a monetary union – past and future enlargement of the euro area
- The rationale of independent central banks
- The common monetary policy in practice – goals, principles, strategy, decision-making bodies and processes
- The implementation of monetary policy in the Euro system
- The transmission mechanism of monetary policy
- Fault lines in the euro area’s economic governance, and reforms in response to the crisis – outlook on future challenges
Requirements: Active class participation (20%) and a mid-term and final exam (40% each).
This course is regularly organized with the support of the Oesterreichische Nationalbank (Austrian Central Bank).