Consumers and the euro

Abstract

Focusing on the social and psychological aspects of introduction of the euro, the author describes its likely impact on consumers on a day-to-day basis during the run-up to and aftermath of 1 January 2002 when the new notes and coins will begin to be distributed in 11 out of 15 EU member states. While admitting that introduction of the euro is likely to be of ultimate direct (easier transactions) and indirect (lower inflation) benefit to consumers, he points out that the period of changeover will be experienced as traumatic by many who have no experience of any comparable change and who will be made to feel like strangers in their own countries. The Phase B - "optional" - period should thus be used to ease the transition by encouraging consumers to become familiar with the new currency pending its "compulsory" introduction in Phase C. A series of policy measures devised by the BEUC to foster consumer acceptance of the euro is described: it is recommended that legislation should be introduced to a) guarantee continuity of contract b) ensure that all conversion transactions are free of charge to the consumer, and c) make dual pricing compulsory for a given initial period.