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A Europe Made of Money

The Emergence of the European Monetary System

by Emmanuel Mourlon-Druol

Publication Year: 2012

A Europe Made of Money is a new history of the making of the European Monetary System (EMS), based on extensive archive research. Emmanuel Mourlon-Druol highlights two long-term processes in the monetary and economic negotiations in the decade leading up to the founding of the EMS in 1979. The first is a transnational learning process involving a powerful, networked European monetary elite that shaped a habit of cooperation among technocrats. The second stresses the importance of the European Council, which held regular meetings between heads of government beginning in 1974, giving EEC legitimacy to monetary initiatives that had previously involved semisecret and bilateral negotiations. The interaction of these two features changed the EMS from a fairly trivial piece of administrative business to a tremendously important political agreement.

The inception of the EMS was greeted as one of the landmark achievements of regional cooperation, a major leap forward in the creation of a unified Europe. Yet Mourlon-Druol's account stresses that the EMS is much more than a success story of financial cooperation. The technical suggestions made by its architects reveal how state elites conceptualized the larger project of integration. And their monetary policy became a marker for the conception of European identity. The unveiling of the EMS, Mourlon-Druol concludes, represented the convergence of material interests and symbolic, identity-based concerns.

Published by: Cornell University Press


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p. 1-1

Title Page, Copyright Page

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pp. 2-5


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pp. v-7

List of Abbreviations

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pp. vii-viii

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Introduction: Multilevel Governance, History, and Monetary Cooperation

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pp. 1-14

The creation of the European Monetary System (EMS) is traditionally considered one of the landmarks of postwar Western European history. Many textbooks stress that it was an example of how European elites coped with global economic change. The advent of floating exchange rates, following the collapse of...

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1. European Monetary Cooperation, 1945–1974: Background and Debates

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pp. 15-29

This first chapter recalls several key ideas necessary to understand the working of monetary coordination. A first important one is the so-called triangle of compatibilities, or trilemma. According to Mundell, of the three components of his “holy trinity”—high capital mobility, fixed exchange rates, and independent...

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2. Shifting Away from the Werner Approach, May 1974–May 1975

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pp. 30-64

Despite the snake’s failures and the abandonment of the Werner Plan, monetary discussions did not stop in 1974. On the contrary, that year saw the multiplication of initiatives in the monetary field. This chapter examines the extent to which the partial buildup of consensus about the need for action at the European...

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3. EMU off the Agenda? June 1975–June 1976

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pp. 65-98

Why and how did economic divergences induce only the partial disappearance of monetary cooperation from the European Community’s agenda between June 1975 and June 1976? In this chapter I first concentrate on the development of a more positive EEC climate after the settlement of the British renegotiation...

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4. Economic Rapprochement, Monetary Standstill, July 1976–June 1977

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pp. 99-131

In this chapter I analyze the paradoxical double turnaround in mid-1976: the improvement of economic convergence among EEC member states but the relative standstill in European monetary cooperation. I cover the period starting with the decision of the newly appointed French government to follow a strong antiinflationary...

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5. Conflicting Options, July 1977–March 1978

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pp. 132-162

In this chapter I analyze the reappearance of the EMU debate at the very top of the EEC’s political agenda, from the decision of the Commission to prioritize monetary cooperation in mid-1977, until before preparation of the European Council’s meeting of April 1978 in Copenhagen. I will do so in three steps. I will first...

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6. A Semisecret Negotiation, Late March–Mid-July 1978

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pp. 163-195

In this chapter I analyze the quest for a new philosophy of the EEC exchange rate system, from Schmidt’s “exotic idea”1 of late March to publication of the Bremen Annex in mid-July 1978. One of the characteristics of the negotiations leading up to the Bremen European Council was that they were conducted at various...

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7. Chasing the Ghosts of Failed Negotiations, Mid-July–Late September 1978

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pp. 196-227

The immediate post-Bremen atmosphere was well captured by The Economist, which wondered, in August, whether EMU would “lay an egg.”1 This snappy catchphrase showed the extent to which the new monetary negotiations, which had (officially)2 commenced after the Bremen European Council, had a historical...

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8. A False Start, October 1978–March 1979

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pp. 228-260

In this chapter I analyze the end of the EMS negotiations and the launch of the new system. The chapter covers the second and last phase of the negotiations, from the decision to adopt a parity-grid system until the entry into force of the EMS in March 1979. By contrast to the previous chapter, this period was much...

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Conclusions: The Emergence of a European Bloc

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pp. 261-262

There is a striking contrast between the EMS’s lack of technical originality and its political, political-psychological, political-economy dimension and later influence. The political dimension of the EMS was indeed so strong that it managed to create the perception over the long run that the EMS was a truly new and...

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pp. 263-264

This book could not have been written without the help of many people and institutions. My first thanks go to Harold James, who kindly and constantly supported and advised me over the past few years. I also benefited from discussions with many colleagues, at different stages of my project and in different manners...

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A Note on Sources Cited in the Notes

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pp. 265-295

Most of the documents consulted are publicly accessible. Only a few required application for a derogation (Giscard papers, Banca d’Italia, Helmut-Schmidt-Archiv). Given that the period studied is very close to the thirty-year rule applied in most European archives, some of the references given are to a...


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pp. 267-336


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pp. 337-347


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pp. 349-359

E-ISBN-13: 9780801465932
E-ISBN-10: 0801465931
Print-ISBN-13: 9780801450839
Print-ISBN-10: 0801450837

Page Count: 368
Publication Year: 2012

Edition: 1