ABSTRACT

European monetary integration has depended on commitments by member states of the European Union (EU) to sustain monetary policies consistent with stable exchange rates. These commitments in turn have depended on the domestic political support that governments can muster for such policies. Two domestic political dimensions were central to the development of the European Monetary System (EMS): the role of economic interest groups with preferences toward the policies associated with EMS membership, and the domestic implications of linking EMS commitments with the broader process of European integration. This chapter 1 analyzes the domestic politics of French and Italian policy toward the EMS from 1979 through the mid-1980s, during which the two countries' commitments to monetary integration gradually hardened.