33 Perspectives on the future of cash from a political, economic and philosophical viewpoint Over the past 20 years, euro cash has become a tangible symbol of economic integration and cohesion in Europe. It stands for stability and trust, especially in times of crisis. However, a look ahead at what the future holds for Europe’s single currency suggests there are some specific challenges looming. For example, the new forms of payment and so-called cryptocurrencies that the digital turn has ushered in have cast fundamental doubt on the status of cash and government-issued currencies. The authors of this book provide a nuanced overview of the topic by looking at multiple aspects of money and currency from different angles. This affords a new sense of perspective in the often vehement debate over the future of our money. With essays by Otmar Issing, Clemens Fuest, Hans-Jürgen Papier, Peter Sloterdijk, Barry Eichengreen, Viviana Zelizer and Gaspard Koenig.

How philosophical differences between Eurozone nations led to the Euro crisis—and where to go from here Why is Europe's great monetary endeavor, the Euro, in trouble? A string of economic difficulties in Greece, Ireland, Spain, Italy, and other Eurozone nations has left observers wondering whether the currency union can survive. In this book, Markus Brunnermeier, Harold James, and Jean-Pierre Landau argue that the core problem with the Euro lies in the philosophical differences between the founding countries of the Eurozone, particularly Germany and France. But the authors also show how these seemingly incompatible differences can be reconciled to ensure Europe’s survival. As the authors demonstrate, Germany, a federal state with strong regional governments, saw the Maastricht Treaty, the framework for the Euro, as a set of rules. France, on the other hand, with a more centralized system of government, saw the framework as flexible, to be overseen by governments. The authors discuss how the troubles faced by the Euro have led its member states to focus on national, as opposed to collective, responses, a reaction explained by the resurgence of the battle of economic ideas: rules vs. discretion, liability vs. solidarity, solvency vs. liquidity, austerity vs. stimulus. Weaving together economic analysis and historical reflection, The Euro and the Battle of Ideas provides a forensic investigation and a road map for Europe’s future.

This volume, the fifth instalment of the classic Report on the European Union series, offers at once an economic and intellectual historical perspective on the creation of the euro and its 20 first years, a comprehensive review of the current and future challenges of the euro area, including a critical look at the different options for the reform of its governance and institutional architecture and finally a close look at the “new euros”, i.e. the ambitious projects that could instil a new life into the stalled European project. It covers a wide range of key economic and social topics such as monetary and fiscal policy, tax competition, the EU budget, structural policy, inequality, gender equality, post carbon economy, well-being advancement and democracy. Weakened by a decade of economic crisis and shaken by the awakening of populism, the European project faces three disintegrations: democratic disaffection, monetary and financial fragmentation and territorial dislocation. If EU member states want to escape those looming risks, they must, as they always have in the last five decades, reinvent Europe in order to save it.

The financial crisis of 2007–10 has presented a number of key policy challenges for those concerned with the long-term stability of the euro area. It has shown that price stability as provided by the European Central Bank is not enough to guarantee financial stability, and exposed fault lines in governance and deficiencies in the architecture of the financial supervisory and regulatory framework. This book addresses these and other issues, including why the crisis affected some countries more than others, whether the euro is still attractive for new EU states, and what policy changes and structural reforms, both macro and micro, should be undertaken to ensure its future viability. Written by a team of leading academic and central bank economists, the book also includes chapters on the cross-country incidence of the crisis, the Irish crisis and ECB monetary policy during the crisis, and studies on Spain, the Baltics, Slovakia and Slovenia.

The euro project has had a difficult second decade but it is worth remembering its successes. The ECB has successfully achieved its primary goal of price stability and the common currency is popular among the euro area’s citizens. This popularity has made the euro more resilient than many people thought possible twenty years ago. A significant number of improvements have been made to the architecture of EMU, have been implemented in the past decade but serious problems remain, relating to fiscal capacity, sovereign default and financial stability. To keep the euro together, Europe’s politicians need to make the euro area less crisis-prone and also an easier place to be during the inevitable cyclical downturns that will happen in the future. The economics profession has provided many plans for future improvements. It is up to Europe’s politicians to implement them. This document was provided by Policy Department A at the request of the Committee on Economic and Monetary Affairs.