Economics, Econometrics and Finance
4 years ago

Euro-area enlargement could hinder ECB effectiveness and overrepresent small countries.

RePEc: Research Papers in Economics
The ECB and Euro-Area Enlargement
Helge Berger

Paper Summary

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The euro area is likely to grow in size, which could affect how the European Central Bank makes decisions. If the number of countries in the euro area doubles, with mostly smaller economies joining, it could make it harder for the ECB to work effectively. This could lead to concerns about smaller countries having too much influence in the ECB Council. The paper talks about these issues, suggests ways to change the ECB's rules, and discusses four possible ways to reform the institution. The ECB Council plans to share reform ideas by the end of 2002.