Bulletin n. 1/2016 | ||
June 2016 | ||
Iozzo Alfonso |
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Monetary Power and Fiscal Power in a Federal System | ||
in Federalist Debate (The) , XXIX, Number 1, March 2016 , 2016 | ||
Having created the institutions necessary for running the monetary union, Europe now needs adequate institutions able to manage the requisite budget increase, mainly to be funded by its own resources. However, there are major institutional differences between the two processes. Monetary Power In a federal system, responsibility for currency is held solely at central level: a single centre must have the right to issue currency and to regulate its quantity. In federal systems such as the United States and Switzerland, a central institution holds this monopoly but it includes representatives of the lower level of government: the Federal Reserve System and the Swiss National Bank. Before the advent of the Euro there was a similar institution in the Federal Republic of Germany: the Bundesbank. | ||