European Economic and Monetary Union Essay -- essays papers

European Economic and Monetary Union The Economic and Monetary Union (EMU) is a single currency area within the European Union in which people, goods, services and capital move without restriction (Europa Quest (1), 2001). Imperative to the success of the EMU is the implementation of a single European currency, the Euro, and the application of specific macro-economic policies by the EMU member states (Harris, 1999: 78). Moreover, it is the foreseeable intent of European governments to create a framework for stability, peace and prosperity through the promotion of structural change and regional development (JP Morgan, 2001). This essay will endeavor to highlight the fundamental gains likely to be accrued by the European business community as a result of EMU policy provisions. The developments and circumstances preceding the EMU formation will be examined to give insight into the functioning of a monetary union. Furthermore, it is essential to analyze the implications the EMU has for firms within both ‘Euroland†™ and other European nations. To establish a strong understanding of the intricacies of the EMU, it is essential to discuss both the antecedents and major developments in this monetary union. The origins of the EMU can be traced to the formation of the European Coal and Steel community (ECSC) in the early 1950s, which was the first attempt to harness European economic unity to achieve greater international competitiveness (Per Jacobson, 1999) (Duisenberg, 1998). The success of this venture prompted the foreign ministers of six ECSC nations to examine the possibility of further economic integration (Chulalongkorn University, 1999). Hence, in 1957 one the most significant agreements in European economics history, The Treaty of Rome, was signed. The Treaty of Rome’s fundamental goal was to provide for the creation of a common market (Kenwood & Lougheed, 1999:280). The most significant aspect of this treaty was the commitment made by such countries as Belgium, France, West Germany, the Netherlands, Italy and Luxembourg to facilitate the free movement of goods, services and factors of production. Essentially, these European governments sought to eliminate internal trade barriers, create common external tariffs and harmonies member states laws and regulations (Hill, 2001: 233). This movement towards a common European market continued with relative success ... ...gheed, 1999. The Growth of the International Economy: 1820-2000. Routledge Press: London. ï‚ · Martin, Peter, 1997. EMU’s New Horizon. www.stern.nyu.edu/nroubini/EMU/. Visited Mach 2001. ï‚ · Preston Robert, 1997. Note of Confusion on Single Currency. www.princetoneconomics.com. Visited April 2001. ï‚ · Princeton Economics, 1998. Country Analysis: United Kingdom. www.princetoneconomics.com . Visted April 2001. ï‚ · Roubini, Nouriel, 1997. Notes on Europe, the Euro and EMU. www.stern.nyu.edu/nroubini/EMU . Visited April 2001. ï‚ · Salmon, Pierre, 2000. Decentralisation and Supernationality: The Case of the EU. www.imf.org. Visited April 2001. ï‚ · Salvatore, Dominick, 1998. International Economics (Sixth Edition). Prentice Hall: New Jersey. ï‚ · Solomon, Robert, 1999. International Effects of the Euro. www.brook.edu/comm/policybriefs/ . Visited March 2001. ï‚ · Soltwedel, Rudiger, Dohse Dirk & Krieger-Boden, Christianne. 2000. European Labour Markets and the EMU Challenges Ahead. www.imf.org . Visited April 2001. ï‚ · Tett, Gillian, 1996. The Single Currency: Everything you wanted to know? . www.stern.nyu.edu/nroubini/EMU . Visited April 2001.