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dc.contributor.authorSteiger, Ottoen_US
dc.description.abstractThe renewed interest in the theory of the lender of last resort (LOLR) as well as the missingLOLR in the Eurosystem has triggered a new thesis on the LOLR: not the central bank butthe Minister of Finance is the true LOLR. The classical theorists of central banking – Steuart,Thornton, Bagehot and Hawtrey – understood, although with some shortcomings, what isoverlooked in modern discourses on the LOLR: there are restrictions for the activities of thecentral bank. While the central bank can create high-powered money for emergency loanswithout limit, its capacity to absorb losses is limited by the size of its capital. Therefore, it hasto rely on the strength of another institution: the taxing power of the Government. In the Eurosystemthe problem of the missing LOLR is twofold: (i) the European Central Bank (ECB)cannot be turned into a LOLR because it is, unlike the national central banks, not a bank ofissue and (ii) the central EU government is weak, with strictly limited taxing powers. Therefore,to prevent financial crises in the Eurosystem not only central bank and tax money solutionshave to be considered but also how to use private money and money from internationalinstitutions.-
dc.publisher|aZEI |cBonnen_US
dc.relation.ispartofseries|aZEI working paper |xB 22-2002en_US
dc.subject.stwEuropäische Wirtschafts- und Währungsunionen_US
dc.subject.stwLender of Last Resorten_US
dc.titleDer Staat als 'Lender of Last Resort' - oder: Die Achillesferse des Eurosystemsen_US
dc.type|aWorking Paperen_US

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