Currency Competition and Foreign Exchange Markets
The Dollar, the Yen and the Euro

A study of international currencies which focuses on the role of the Euro.

Philipp Hartmann (Author)

9780521632737, Cambridge University Press

Hardback, published 10 December 1998

212 pages, 22 tables
22.9 x 15.2 x 1.6 cm, 0.46 kg

'[Hartmann's] book stands out for its broad scope and unusual blend of theory, historical and institutional account of financial markets, and empirical evidence. … Overall, Hartmann has written an interesting and innovative study with relevance to both academics and practitioners. … Hartmann's conclusions about the relatively slow pace with which the euro will advance in international financial markets appear to be based on a sound analysis of the trends and characteristics of the different market segments. His observation that the disappearance of intra-European forex transactions by definition will exert a downward influence on the euro's market share initially, is worth stressing. In this respect, Hartmann provides a welcome and needed counterweight to existing overly optimistic forecasts of an increased role of the euro internationally together with an immediate euro appreciation.' De Economist

Currency Competition and Foreign Exchange Markets by Philipp Hartmann of the European Central Bank is a major theoretical and empirical study of international currencies, which focuses on the role which the Euro will play in the international monetary and financial system along with the US dollar and the Japanese yen. In contrast to much of the existing literature which approaches the subject from a macroeconomic perspective, Philipp Hartmann develops a theoretical model which uses game theory, time series and panel econometrics, and links financial markets analysis with transaction cost economics. The results of Currency Competition and Foreign Exchange Markets are presented with reference to political, historical and institutional considerations, and provide accessible answers to policy-makers, business people and scholars worldwide. The sections on Spread Estimation and Multiple Vehicles with Inter-Dealer Price and Entry Competition will be of particular use for finance professionals.

List of figures
List of tables
Preface and acknowledgements
1. Introduction
2. National and international money: a survey
3. A theory of vehicle currencies
4. Currency competition between the euro, the dollar and the yen
5. Trading volumes and transaction costs: from the short run to the long run
6. General conclusions
Bibliography
Index.

Subject Areas: Monetary economics [KCBM]