Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/173475
Authors: 
Amato, Massimo
Fantacci, Luca
Papadimitriou, Dimitri B.
Zezza, Gennaro
Year of Publication: 
2016
Series/Report no.: 
Working Paper No. 866
Abstract: 
After reviewing the main determinants of the current eurozone crisis, this paper discusses the feasibility of introducing fiscal currencies as a way to restore fiscal space in peripheral countries, like Greece, that have so far adopted austerity measures in order to abide by their commitments to eurozone institutions and the International Monetary Fund. We show that the introduction of fiscal currencies would speed up the recovery, without violating the rules of eurozone treaties. At the same time, these processes could help transition the euro from its current status as the single currency to the status of "common clearing currency," along the lines proposed by John Maynard Keynes at Bretton Woods as a system of international monetary payments. Eurozone countries could therefore move from "Plan B," aimed at addressing member-state domestic problems, to a "Plan A" for a better European monetary system.
Subjects: 
Euro
Fiscal Currencies
Austerity
Current Account Imbalances
Clearing Union
JEL: 
E02
E12
E42
F45
Document Type: 
Working Paper

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