Banks, politics and European Monetary Union

Arbeitspapier

This contribution to the panel on the future to EMU discusses the tensions that arise from the fact that banks are, on the one hand, an essential element of the monetary transmission mechanism and, on the other hand, an integral part of local, regional or national polities. Banking union can eliminate or at least reduce some of the procrastination that has allowed maintained bank weaknesses to persist and harmed the transmission of monetary policy but, whereas the SSM has been fairly successful, resolution is still not working properly and needs further reforms. At the same time, banking union suffers from the problem that interventions from Brussels or Frankfurt are seen as infringements of national sovereignty that lack political legitimacy. The conflict between supranational and national interests is ultimately irresolvable but, if EMU is to survive, measures must be taken to limit its impact.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Discussion Papers of the Max Planck Institute for Research on Collective Goods ; No. 2019/13

Classification and Topics

• Classification: Wirtschaft ; Monetary Systems; Standards; Regimes; Government and the Monetary System; Payment Systems ; Financial Markets and the Macroeconomy ; Money Supply; Credit; Money Multipliers ; General Financial Markets: Government Policy and Regulation ; Financial Institutions and Services: Government Policy and Regulation ; Bankruptcy; Liquidation
• Subject: Monetary union ; central banking ; politics of banks ; banking union ; bankresolution ; bail-in

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hellwig, Martin
• Event: Veröffentlichung
• (who): Max Planck Institute for Research on Collective Goods
• (where): Bonn
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/229985
• Last update: 10.03.2025, 11:43 AM CET