The ECB in an Enlarged Monetary Union: How to Reform the Rotation Scheme

The ECB recently announced the details of a rotation scheme for voting rights it will implement for its Governing Council as soon as the number of member states exceeds 18. However, skepticism remains regarding whether this model is appropriate to prepare the ECB for euro-zone enlargement. This study proposes, discusses, and evaluates possible amendments to this model from three perspectives (efficiency, European orientation, transparency) that deal with flexible majority voting, regrouping of countries, weighted voting, and centralised decision making. Each model improves on the rotation model in some respect, yet only a move toward more centralised decision making promises efficient, timely, and transparent decisions that avoid national biases. The widespread skepticism about the political acceptability of this approach is not shared in this paper. Instead, we note encouraging signs that a European identity is close to developing so that centralised policy making can be expected to gain more legitimacy and acceptability