Current Account ‘Core-Periphery Dualism’ in the EMU

Tatiana Cesaroni, Roberta De Santis. Current account dispersion within EU member states has been increasing since the 1990s. Interestingly, the persistent deficits in many peripheral countries have not been accompanied by a significant growth process that is able to stimulate a long-run rebalancing, as neoclassical theory predicts. To shed light on the issue this paper investigates […]

Sovereign debt, bailouts and contagion in the Eurozone

Michal Kobielarz, Burak Uras & Sylvester Eijffinger. The Eurozone Crisis has been characterised by a sharp rise in sovereign interest rates in peripheral countries. The re-emergence of spreads between peripheral and core Eurozone countries at the start of the Greek crisis came after a decade of homogeneous interest rates in the monetary union. This column […]

How to reduce the Greek debt burden?

Darvas, Zsolt, Hüttl, Pia. The Greek debt reduction issue has been put back on the table as the 25 January 2015 parliamentary snap elections are approaching. Already in November 2012, Eurogroup conclusions stated that “Member states will consider further measures and assistance … if necessary, for achieving a further credible and sustainable reduction of Greek debt-to-GDP ratio, when […]

Structural Reforms Will Not Mitigate The Risk Of Deflation In Europe

Theodoropoulou, Sotiria. In a speech delivered at the Central Bank of Latvia on October 17th, Benoit Coeuré, member of the executive board of the ECB and apparently one of the currently few close confidants of Mario Draghi, argued that speeding up the pace of structural reforms in the Eurozone could be key to averting the […]

How to climb a mountain with both hands tied

Jean Pisani-Ferry. A triple-dip recession in the Eurozone is now a distinct possibility. This column argues that additional monetary stimulus is unlikely to be effective, that the scope for further fiscal stimulus is limited, and that some structural reforms may actually hurt growth in the short run by adding to disinflationary pressures in a liquidity […]

The ECB as lender of last resort?

Charles A.E. Goodhart, Dirk Schoenmaker As part of the move to a banking union, the largest banks in the Eurozone will soon be supervised by the ECB. This column argues that supervision and the lender of last resort function should be seen as a joint product. After the introduction of the euro, the national central […]

Is the ECB doing QE?

Charles Wyplosz. Last week, the ECB announced that it would begin purchasing securities backed by bank lending to households and firms. Whereas markets and the media have generally greeted this announcement with enthusiasm, this column identifies reasons for caution. Other central banks’ quantitative easing programmes have involved purchasing fixed amounts of securities according to a […]

Investing for Europe’s Future

Mateusz, Szczurek. The ‘lost decade’ is not a scenario for the EU, it’s the baseline forecast. In this column, Polish Finance Minister Mateusz Szczurek calls for an EU-wide public investment programme of 5.5% of GDP to overcome the constraints behind Europe’s ‘secular stagnation’. He calculates that €700 billion of capital expenditures could close the output […]

Eurozone delusions

Wren-Lewis, Simon. I have already had a number of interesting comments on my previous post which illustrate how confused the Eurozone macroeconomic debate has become. The confusion arises because talk of fiscal policy reminds people of Greece, the bailout and all that. That is not what we are talking about here. We are talking about what happens when […]

How to jumpstart the Eurozone economy

Giavazzi, Francesco, Tabellini, Guido. The stagnating Eurozone economy requires policy action. This column argues that EZ leaders should agree a coordinated 5% tax cut, extension of budget deficit targets by 3 or 4 years, and issuance of long-term public debt to be purchased by the ECB without sterilisation. Πηγή: Voxeu πλήρες κείμενο