Das Stagflationsproblem und Europa
b'This note, published in 1995, assesses the problems that might be entailed by the introduction of the European monetary union. It is argued that wage pressure will not be diminished by forming the union, and the stagflation problem that lies at the root of the rising trend in unemployment will persist. As exchange rates cannot serve to compensate different wage developments in the monetary union, imbalances will result, and subsidization less competitive member states will be necessary. An indexation of wage settlements is proposed that, similar to exchange rates, permits to compensate divergent developments in wage rates across member states while maintaining the monetary union.'