Patrick Minford Bücher

European economic and monetary union is driven by politics, but the economic costs and benefits of Britain's membership can and should be assessed, argues Professor Patrick Minford in this careful and succinct analysis of the cases for and against Britain adopting the Euro. The core argument in favour is the reduction of exchange-rate risk, but because the Euro is a regional currency that has fluctuated considerably against the dollar, exchange-rate variability might not be less under the Euro and could even increase. In any case, financial markets can diversify away such risks. Minford sees substantial costs of membership: increased variability of UK output, employment and prices in response to shocks; damaging harmonisation of tax rates, social support and regulation; and the possibility that British taxpayers will have to meet some of the costs of big projected state pension deficits in Germany, France and Italy. He concludes that EMU, 'as it is constituted and planned would be strongly against British interests to join'.

This timely book sets out a shrewd and comprehensive policy programme, for both 'microeconomic' supply-side settings of tax and regulatory systems, and 'macroeconomic' policies for fiscal and monetary policies to regulate demand and support the supply-side growth agenda.

Examining the debate from when the euro was first introduced to the sources of its current problems, this book proposes radical solutions to resolve the long-running crisis of the European Monetary Union. Initially, free-market economists were generally supportive of the euro, believing it would reduce the tendency towards inflation and encourage economic reform. However, in this current analysis, the authors--a group of leading monetary economists--make it perfectly clear that if the members of the eurozone are to prosper in the long term, the status quo cannot continue. These nine essays explore topics that include the UK's decision not to join, the fate of past monetary unions, why the euro is failing, practical exit strategies, and a possible free-banking solution for the eurozone, among many more.