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Canada (162,366)
POLI 243 (70)
Chapter 24

CHAPTER 24: GERMANY’S ROLE IN THE EUROPEAN MONETARY UNION

2 Pages
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Department
Political Science
Course Code
POLI 243
Professor
Mark Brawley

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CHAPTER 24 GERMANYS ROLE IN THE EUROPEAN MONETARY UNION Under the ERM each currency had to fix its value against a single basket of currencies The Performance of the EMSThe system offered the stability they wanted without locking them in permanentlyThe common currency relied heavily on the DM allowing Germanys central bank to set an independent policyGave the countries stability and enough freedom to pursue their own macropolicy goals Deciding on the Next Step Monetary UnionRisk in currency instability would be eliminated Transaction costs associated with economic activity among the member states would be reducedStages of the Move o A period in which the last national capital controls were removed o The members would coordinate their macropolicies o An EU wide central bank would be created a new common currency introduced and coordinated fiscal policies f
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