The Euro, the European Central Bank, and the International Monetary System

1994-95. He has taught at the Universities of Vienna, Rome, Triest, and Krems. He pub-lished extensively in the field of international trade and finance and is editor of the Eco-nomics Handbook Series for the Greenwood Press. ABSTRACT: The creation of the euro at the beginning of 1999 repre-sents one of the most significant events in international finance since the end of World War II. Never in the past had a group of sovereign na-tions voluntarily given up their national currency for a common cur-rency. The article begins by reviewing the benefits and costs of the euro on the participating countries; it then examines the role of the European Central Bank (ECB) in the conduct of monetary policy in the European Monetary Union, as well as its effect on the euro/dollar and euro/yen exchange rates; finally, the article analyzes the effect that the ECB has and is likely to have on the functioning of the inter-national monetary system. at PENNSYLVANIA STATE UNIV on May 9, 2016ann.sagepub.comDownloaded fro