are, however, problems that the single monetary policy is not in a position to address. it is the task of national economic policies to avoid and to counteract such situations. i will come back to these issues later. inflation differentials may also be induced by economic or policy shocks which affect the euro area countries and regions in different ways and at different times. also, local economies may respond dissimilarly to a common shock because of their individual economic structures. especially in the run - up to stage three of emu, the quantitative relevance of asymmetric shocks has attracted a lot of attention both among analysts and among economic observers. the economic framework they had in mind, known as the optimum currency area theory, predicts that the creation of a common monetary area becomes more costly the more the participating countries experience idiosyncratic shocks, in terms of size, nature and frequency, and the more varied their responses to such shocks are. while asymmetric shocks and adjustment mechanisms have to be recognised as realities, they also have to be seen in a more general framework, within which all gains from stage three of emu are taken into account. these gains are sizeable. from a political point of view, monetary unification, as part of a more general process of european integration, should be seen as bringing long - lasting peace and a higher level of co - operation between participating countries. from an economic point of view, monetary unification should be seen as bringing greater prosperity and stability. there is no doubt in fact that stage three of emu has, and will have, a net positive impact on france and all other participating countries. it is, however, worth examining its potential effects resulting from asymmetries. to what extent do these asymmetries still exist and are they a concern? one useful way of approaching this problem is to compare the euro area with the united states. the us appears to be a fairly natural benchmark. its economy is similar in several ways to that of the euro area, not least in the size of its economy and population. one line suggested by this approach is to compare the degree of synchronisation of economic activity among euro area countries with that of us states or regions. one interesting finding that emerges from the empirical literature is that asynchronous fluctuations also take place in the us. we therefore should not be surprised to observe a similar fact in the euro area. however, the evidence resulting from several studies carried out in

willem f duisenberg : why price stability? welcome speech by dr willem f duisenberg, president of the european central bank, at the first ecb central banking conference, held in frankfurt, 2 - 3 november 2000. * * * ladies and gentlemen, it is with great pleasure that i welcome you to frankfurt on the occasion of the first ecb central banking conference entitled “ why price stability? ”. this new series of conferences that starts today and will be organised every second year is the ecb ’ s contribution to a process of open interaction between economists concerned by central banking issues. the conference series should serve as a vehicle for signalling the role of the ecb as a key player in central banking, by bringing together researchers from leading academic and international institutions, including the european parliament, and economists from ministries of finance, central banks in the escb, accession countries and also from non - european central banks. one of its main purposes is to launch a process of exchanging views and information on topics that are highly relevant for the policy objectives of the ecb. the topic chosen for this first conference - why price stability? - is particularly relevant for the policy objective of the ecb. this is because price stability in the euro area is a fundamental obligation assigned to the ecb by the maastricht treaty. moreover, by maintaining price stability, monetary policy makes its best possible contribution to the achievement of a high level of growth and employment in the long term. an important feature of this conference series is that it welcomes the presence of the press. participation by journalists in this type of conference should provide them with additional background information on monetary policy issues. this should serve to enhance the public ’ s knowledge of policy - making at the ecb, as well as to further consolidate the ecb ’ s openness, transparency and accountability. last, but not least, the ecb conference series should make a contribution to economic literature through the publication of the conference proceedings in a book. it is also intended to publish even more extensive proceedings on the ecb ’ s website. less than a year ago we organised, together with the centre of financial studies at the university of frankfurt, the first large, open conference of the ecb on “ monetary policy - making under uncertainty ”. on that occasion, i had the opportunity to signal clearly our commitment to a continuous and active exchange of information between the ecb and the academic world. today, with a track record of almost two years of monetary