Historical errors in the initial conception of the euro and its subsequent development
In 1992, the European Council launched the economic and monetary union (EMU). The inception of the euro followed in 1999. Ever since, the EMU has experienced severe malfunctions, not least during the recent Eurozone crisis of 2010. To understand the current Eurozone (EZ) conundrum, it is necessary to analyse the circumstances under which the EMU was designed. Throughout its development, former French President François Mitterrand proved to be a central figure due to his ability to influence the European integration process. Against the back of German reunification, Mitterrand succeeded in obtaining the creation of an EMU from Germany. However, he thereafter failed to prevent the same union from being shaped according to the German model. This contribution argues that Mitterrand’s inability to form the EMU according to his own ideals partly explains the structural failures of the EZ.
JEL Classification: F5.
Keywords: Euro, eurozone, eurozone crisis, European Monetary Union, François Mitterrand