JOURNAL ARTICLE
Cite JOURNAL ARTICLE
Style
Format
A Conceptual Approach to the Creation and Allocation of Central Bank Profits in the Euro Area
Credit and Capital Markets – Kredit und Kapital, Vol. 33 (2000), Iss. 1 : pp. 39–61
Additional Information
Article Details
Author Details
Gerhard Rosi, Hamburg
Wolf Schäfer, Hamburg
References
-
Apholte, A./von Köppen-Mertes, I. (1997): Währungsreserven auf dem Weg in die EWU, in: Wirtschaftsanalysen, Trends, Frankfurt a.M.
Google Scholar -
Centralbanking (1997): The winners and losers from EMU, in: Centralbanking, Vol. 7, No. 2., p. 6 - 10.
Google Scholar -
European Central Bank (1998a): The Single Monetary Policy in Stage Three - General documentation on ESCB monetary policy instruments and procedures, September, Frankfurt a.M.
Google Scholar -
European Central Bank (1998b): Press Conference, 3 November.
Google Scholar -
European Central Bank (1999): Consolidated opening financial statement of the European System of Central Banks (Eurosystem) as at 1 January 1999. Press release 5 January 1999.
Google Scholar -
European Monetary Institute (1997): Annual report 1996, Frankfurt a.M. - Gros, D. (1993): Seigniorage and EMU. The Fiscal Implications of Price Stability and Financial Market Integration, in: Euro- pean Journal of Political Economy, Vol. 9, p. 581 - 601.
Google Scholar -
Gros, D. (1998): Distributing Seigniorage under EMU, in: Ifo-Schnelldienst 17 - 18, p. 29 - 39.
Google Scholar
Abstract
The conceptual approach to the allocation of monetary competence within the Euro area leads to a tripartite system concerning the creation of central bank net profits: it is divided into an ECB-, NCB-ESCB-specific and NCB-ESCB-independent component. The expected amount of the ECB-net gain is rather limited due to the ECB’s lack of operational activities. Furthermore it is unlikely that any noteworthy redistribution effects will occur. But the same does not hold for a considerable proportion of NCBs’ net gains. According to Art. 32.2 of the ECB/ESCB Statute, the monetary net income of the NCBs are to be pooled and - in terms of our basic concept - have to be interpreted as ESCB-specific net profits generated by the NCBs. They are recorded following the deadline-earmarking-procedure. Resulting unwelcome redistribution effects might not be entirely avoidable, but they can be restricted by applying a suitable procedure. The analysis of the NCBESCB- independent component enquires into the scope for monetary policies left to NCBs even after entering the monetary union. This proportion of NCB-ESCBindependent net profits should be recorded separately and stay with each NCB, respectively. (JEL E50, E58, E59)