Eurowinners and Eurolosers: The Distribution of Seignorage Wealth in Emu

CES Working Paper at Univ. of Munich #134

28 Pages Posted: 22 Oct 1997

See all articles by Hans-Werner Sinn

Hans-Werner Sinn

CESifo (Center for Economic Studies and Ifo Institute); National Bureau of Economic Research (NBER); Ludwig Maximilian University of Munich (LMU)

Holger Feist

Princeton University - Princeton School of Public and International Affairs; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: May 1997

Abstract

The European Monetary Union (EMU) will involve socialization of the existing seigniorage wealth of the national central banks because the Euro will have to be bought by these banks in exchange for assets which have been accumulated in the historical process of money creation. This socialization will create windfall gains for countries with relatively low monetary bases such as France and the UK, and it will be disadvantageous for countries like Germany, the Netherlands and Spain, which will suffer per capita wealth losses of between 406 and 182 ecus. This paper quantifies the gains and losses in seigniorage wealth under alternative membership and bank regulation scenarios.

JEL Classification: E58, F33, F42

Suggested Citation

Sinn, Hans-Werner and Feist, Holger, Eurowinners and Eurolosers: The Distribution of Seignorage Wealth in Emu (May 1997). CES Working Paper at Univ. of Munich #134, Available at SSRN: https://ssrn.com/abstract=37489 or http://dx.doi.org/10.2139/ssrn.37489

Hans-Werner Sinn (Contact Author)

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Princeton University - Princeton School of Public and International Affairs ( email )

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