This paper discusses the institutional changes needed in Europe if prompt corrective action (PCA) is to be effective in supervising and resolving cross-border banking groups. The paper identifies these changes starting with enhancements in the availability of information on banking groups' financial condition to prudential supervisors. Next, the paper considers the collective decision making by prudential supervisors with authority to make discretionary decisions within the PCA framework as soon as a bank in a cross-border banking group falls below the minimum capital standard. Finally, the paper analyzes the coordination measures that should be implemented if PCA requires the bank to be resolved. [ABSTRACT FROM AUTHOR]
Examines the historical pattern of aggregate demand and supply shocks in several European Monetary System countries in order to assess the desirability of monetary union. Use of structural vector autoregressive models (VARs) to estimate the fundamental demand and supply shocks; Results suggesting that monetary union may not be desirable.
Focuses on the proposed European currency unit. Exchange rate; Monetary policy; History of monetary unions; Potential gains from monetary union; Surrounding monetary independence; Stabilizing factors; Incentives for monetary restraint.
PRICE inflation, MONETARY unions, NATIONAL currencies, EUROPEAN currency unit, CURRENCY question, INTERNATIONAL economic integration, MONEY, EURO
Abstract
Presents a documentation of the behavior of inflation dispersion and inflation differentials in Euro-area countries before and after the introduction of the Euro. Details on the process of European monetary union; Discussion on the currency union and inflation differentials; Adoption of the Euro and the behavior of inflation.
Published
2003
Discovery Service for Jio Institute Digital Library
For full access to our library's resources, please sign in.