Monetary issues in the European story: 1948-1978

Abstract

The European monetary story, from the end of World War II to the implementation of the European Monetary System and the ECU, is identified with the paradox that the member states of the EEC wanted greater economic union while resisting sovereignty transfer in the monetary field. The imbalances caused by this paradox endangered the viability of the European project. In order to confront them, the private sector promoted the creation and use of 'basket currency', such as the European Monetary Unit or the 'Eurco' which, at the same time, served to point out to politicians the need for a single European currency. All this took place in an international context where the dollar and its problems were transferred to the currencies of the EEC states, making it quite difficult to maintain some balance in the value of intra-community trade, which implied continuous monetary crises.