*** CHRIS MULHEARN, HOWARD R. VANE: The Euro. Its origins, development and prospects. Edward Elgar Publishing (Glensanda House, Montpellier Parade, Cheltenham, Glos GL50 1UA, UK. Tel: (+44-1242) 226934 - Fax: 262111 - email: info@e-elgar.co.uk - Internet: http://www.e-elgar.com ). 2008, 243 pp. ISBN 978-1-84720-051-8.
In its first ten years, the euro has certainly been able to turn itself into a subject of debate. It has to be noted, however, that between specialist press articles, urban legends and books on advanced economic analysis that are often offputting for beginners, few authors can claim to have written anything that is both reader-friendly and capable of feeding the debate among specialists. In this book, Chris Mulhearn and Howard R. Vane, professors in economics in the United Kingdom, bridge the gap. The wide-reaching tone of the book is hinted at in the title. It is written for Everyman with the aim of providing readers with all the information they require to understand the importance of the single currency venture.
This is a considerable challenge and the authors carry it off magnificently. From the very first page, the book deftly meshes the political, economic and historical dimensions of the euro in a disconcertingly smooth fashion without ignoring technicalities. Each chapter starts with a page on the history of Economic and Monetary Union, covering its origins, the first stages of monetary union (with a special chapter taking an in-depth look at the 1970 Werner Report that paved the way for monetary union in 1980 before being abandoned), the economic challenges surrounding joining the euro, introducing a common monetary and budgetary policy, the enlargement process and reflections on the single currency's future. At the end of each chapter, there is an interview with one or more recognised academics who add to the authors' ideas, answering concise and brilliant questions to explain the various ways that the euro is viewed by experts in the current debate on Economic and Monetary Union.
In this period of economic and financial crisis, when some are predicting the collapse of the single European currency, the book comes at the right moment because it provides a comprehensive and natural analysis of the issue. The authors review the economic benefits provided by the euro, for example, and then look at what had to be given up in return, namely sacrosanct national monetary policy and the ability to adjust exchange rates, an ability that was so useful in the past in times of economic crisis. They add that determining whether the benefits of joining the euro outweigh the costs for any particular country is an extremely arduous task, as is determining whether the eurozone should be seen as the optimal monetary zone. The European Central Bank and the Stability and Growth Pact are picked apart by the authors, while chapters five and six look at enlargement. Why did Denmark, Sweden and the United Kingdom refuse to join the close-knit eurozone club? What problems are being encountered by the countries of central and Eastern Europe in joining the euro? Crucial questions and so highly topical in the light of the crisis and the wider questions about society that the crisis is generating.
By way of conclusion, the authors reflect on the future prospects for the single currency. An ambitious approach leading to three well-argued, although unsurprising, scenarios about what might happen to the single currency in the next ten or fifteen years, according to the extent to which it matches an optimal monetary zone. Ample food for thought, although the authors could not resist selecting which of the three they feel is the most likely scenario, after analysing all three. They explain that in the medium or long-term, European Monetary Union is highly likely to grow modestly in terms of geographical coverage and international status. They do not predict an optimal monetary zone, but neither do they predict disaster. This book was, of course, written before the financial crisis, and only time will tell whether the crisis will invalidate the authors' predictions. This does not change the fact that the book is an important contribution to European economic literature through its highly comprehensive coverage and user-friendliness.
Thomas Bauwens
*** ANDREAS BEYER, LUCREZIA REICHLIN (Eds.): The Role of Money. Money and Monetary Policy in the Twenty-First Century. European Central Bank (29 Kaiserstrasse, D-60311, Postfach 160319, D-60066 Frankfurt am Main. Tel: (49-69) 13440 - Fax: 13446000 - Internet: http://www.ecb.int ). 2008, 352 pp. ISBN 978-92-899-0207-6.
What should be the role of money in the economy? With the “help” of the crisis, this question is clearly gnawing away at many at present. Irrespective of the financial and economic crisis we are currently suffering from, the issue has long been at the heart of debates among politicians and academic experts on monetary issues, as can be seen from this detailed book on ideas expressed at the fourth conference organised by the European Central Bank on the issue, which was held in November 2006. As Lucrezia Reichlin points out in the introduction, people no longer bat an eyelid at the idea that the European Central Bank (that manages the single currency) should have taken the initiative of organising these conferences, because the ECB is the only central bank these days that still clearly gives currency a special role under its two-pillar strategy. Why did currency lose its key role, taking on instead the role of combatting inflation? This question is asked by leading experts, including the head of the ECB in Frankfurt, Jean-Claude Trichet, Ben Bernanke of the United States, Kazumasa Iwata of Japan and Zhou Xiaochuan of China, not to mention leading academics. The essays provide analytical, empirical and historical answers to these questions. Needless to say, the subject matter and manner in which it is dealt with make this a book more suited for an expert readership…
(PBo)
*** HERIBERT DIETER, LEONARD SEABROOKE, ELENI TSINGOU: The Global Credit Crisis and the Politics of Financial Reform. Garnet Network of Excellence (56 rue Jacobs, F-75006 Paris. Tel: (33-1) 58717000 - Fax: 58717091 - Internet: http://www.garnet-eu.org ). "Garnet Policy Brief", No. 8. 2009, 12 pp.
Three researchers at academic institutions that are membersof the Garnet Network of Excellence (Global Governance, Regionalisation and Regulation: the Role of the EU) funded by the EU's 6th Framework Programme, look in this policy brief at how the financial crisis unfurled and how decision-makers are reacting to it, particularly in the European Union. The authors make recommendations about how to solve the situation, recommending for example that the Bank of International Settlements is given a greater role, that the Financial Stability Forum is turned into a formal institution, and that the G20 should replace the G7-G8. Unsurprisingly, they also call for European countries to act in a more coordinated manner to consolidate the financial system.
(PBo)
*** DANIEL GARRIGUE: L'Europe face à la crise financière. Commission chargée des affaires européennes de l'Assemblée nationale (Boutique de l'Assemblée nationale, 7 rue Aristide Briand, F-75007 Paris. Tel: (33-1) 40630033 - Internet: http://www.assemblee-nationale.fr ). "Documents d'information" series, No. 1,291. 2008, 128 pp, €5. ISBN 978-2-11-124088-9.
This newsletter assesses from the French viewpoint initial action taken by the European Union under the French Presidency to shore up the EU against the financial tsunami that is destabilising the world. The EU's reaction demonstrated the return of state power, argues French parliamentarian Garrigue, adding that the meeting of Eurogroup attended by heads of state was a key turning point. After examining initial steps in coordinating national recovery plans, the author looks at how the EU could ensure the world's financial and monetary system is reformed. To this end, he calls for people not to revert to 'yellow-bellied sighs of relief' when the crisis eases, but instead to roll up their sleeves and work together to ensure that regulation, supervision and moral standards emerge stronger from the current trials and tribulations.
(MT)
*** Documents. Revue du dialogue franco-allemand. Bureau International de Liaison et de Documentation (50 rue de Laborde, F-75008 Paris. Tel: (33-1) 43879040 - Fax: 42935094 - email: revue@bild-documents.org - Internet: http://www.revuedocuments.com ). 2007, No. 3, 80 pp, €7-80. Annual subscription: €39. This issue includes an article on the different responses of France and Germany to the international financial and economic crisis. There is a special report on cinema.
(MT)
*** KLAUS LIEBSCHER, JOSEF CHRISTL, PETER MOOSLECHNER, DORIS RITZBERGER-GRUNWALD (Eds.): Foreign Direct Investment in Europe. A Changing Landscape. Edgar Elgar Publishing (Glensanda House, Montpellier Parade, Cheltenham, Glos GL50 1UA, UK. Tel: (+44-1242) 226934 - Fax: 262111 - email: info@e-elgar.co.uk - Internet: http://www.e-elgar.com ). 2008, 274 pp. ISBN 978-1-84720-487-5.
This study looks at direct foreign investment (dfi) in Europe, more specifically in Central and Eastern Europe. Seen as an important component of economic development, dfi is monitored very closely by economists because of its volatile nature. In the current economic crisis, investment flows will obviously not be the same as in the past, and while investments used to flow from developed to less economically developed countries, investment is now being seen flowing both ways. Moreover, this foreign investment, so cherished by developing economies, is becoming more difficult to attract. The authors of this book, the governor of Austria's national bank and some of his deputies, use econometric models and empirical studies to identify new trends in fdi. They examine, for example, the role of players like China, exploring the new directions Chinese fdi is taking and giving concrete examples of action and measures likely to attract foreign capital.
(NDu)
*** STEPHEN DAVIES, BRUCE LYONS: Mergers and Merger Remedies in the EU. Assessing the consequences for competition. Edward Elgar Publishing (see above). 2008, 274 pp. ISBN 978-1-84720-487-5.
When one reads in the press about mergers and acquisitions of companies in the European Union, it is often in a headline referring to the European Commission's rejection of a planned deal. Academic research has been closely monitoring these rejections but go-aheads tend to be ignored despite the fact that there are ten times as many go-aheads as rejections. In the light of this gap, the Commission encouraged and backed this study looking at the impact of authorised mergers on competition on the markets and competition between the players involved, with the aim of assessing the extent to which the mergers were beneficial (or detrimental) to competition and what would have happened if the merger had not taken place in the industry in question. This book publishes the study's findings, for which the authors were given access to information outside the public domain which enabled them to discern the expected impact of the mergers before they took place and then compare these expectations with what actually panned out. The highly technical nature of the results means the book will be of special interest to economists, academia and decision-makers touching on the domain of competition.
(NDu)
*** The Iron Rhine (IJzeren Rijn) Arbitration (Belgium-Netherlands). Award of 2005. Editions T. M. C. Asser Press (P. O. Box 16163, 2500 BD The Hague, the Netherlands. Internet: http://www.asserpress.nl - Distribution: Cambridge University Press, The Edinburgh Building, Shaftesbury Road, Cambridge CB2 2RU, UK. Tel: (+44-1223) 326050 - Fax: 326111 - email: directcustserve@cambridge.org - Internet: http://www.cambridge.org ). "Permanent Court of Arbitration Award Series". 2007, 314 pp. ISBN 978-90-6704-235-2.
The Iron Rhine was originally the name given to the railway line from Antwerp in Belgium to Duisburg in Germany via the Netherlands ("Rhin de fer" in French and "Ijzeren Rijn" in Dutch). The legal origins of the railway line date back at far as the Vienna Congress, and the railway resulted from the separation treaty that cut off Antwerp by land from the Germanic Empire by adding part of the Netherlands in-between. Under Article XII of the treaty, if Belgium decided to build a road or canal to the region of Sittard, it would then be entitled to ask Holland, which would not be able to refuse, to extend the road or canal across Sittard to the borders of Germany. Belgium would bear the costs of the venture. The railway line was incorporated into the Dutch public railway system but was destroyed during World War Two. It was restored after the war but was only used intermittently and came to a halt in 1991, at which point there were no longer any barges travelling between Belgium and Germany on this canal. People in Belgium, however, are interested in getting the route working again, but this would run counter to Dutch business interests because the Dutch are planning their own rail freight network between Germany and the port of Rotterdam, and the idea is also generating ecological concerns due to the location of nature reserves along the old Iron Rhine. Belgium and Germany are in talks in this connection but are in deadlock over practical details and cost sharing and have decided to submit the matter to the Permanent Court of Arbitration. This book in English and French publishes the court's proceedings. It issued its ruling in 2005.
(NDu)