The renewed phase of tension in Europe, and the Eurozone in particular, since the second half of 2011, with the prospect of a double-dip recession alternating with that of a sovereign-debt crisis, has reignited the debate on fiscal austerity, to which European governments have been committed since the end of the most acute phase of the crisis in 2009.
Fiscal austerity and policy credibility
Marco Buti, Lucio R Pench, 20 April 2012
Topics: EU policies, Macroeconomic policy
Tags: austerity, eurozone, fiscal policy
Is the euro rescue succeeding? An update
Uri Dadush, Zaahira Wyne, 20 April 2012
The current gyrations of sentiment over government-bond spreads are diverting attention from the real issue – the Eurozone periphery needs a big realignment towards the tradable sector to reignite growth sustainably.
Topics: EU policies, Exchange rates, Macroeconomic policy
Tags: eurozone, Eurozone crisis, real exchange rates
Too early to sound the alarm
Manfred J M Neumann, 17 April 2012
Debt finance of public consumption has clearly gone too far in several countries. Too far in the sense that it has reached if not exceeded the borderline of sustainability. Have austerity measures meanwhile gone too far, too?
Topics: EU policies, Macroeconomic policy
Tags: austerity, eurozone, fiscal policy
The EZ breakup contest: Take ignorance seriously
Richard Baldwin, 10 April 2012
The Eurozone might not survive in its current form. Buiter and Rahbari (2012) put a likelihood of 50% on Greek exit – an event that would be something between an historic event and a global economic catastrophe (depending on how it was handled).
Topics: Macroeconomic policy
Tags: eurozone, EZ breakup contest, Greek exit
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The problems of European monetary union – asymmetric shocks or asymmetric behaviour?
Andrea Boltho, Wendy Carlin, 31 March 2012
Much of the literature that was sceptical of the prospective success of the euro feared the effects of Mundellian asymmetric shocks on an area which (unlike the US) had little inter-country labour mobility and no common fiscal policy.
Topics: Europe's nations and regions
Tags: eurozone, governance, growth
From vicious to virtuous: A five-point plan for Eurozone restoration
Marco Buti, Pier Carlo Padoan, 27 March 2012
Download CEPR Policy Insight No. 61 here [1]. [1] http://voxeu.org/sites/default/files/file/PolicyInsight61.pdf
URL: http://www.cepr.org/pubs/PolicyInsights/CEPR_Policy_Insight_061.asp
Topics: Macroeconomic policy
Tags: eurozone, fiscal consolidation, growth
- 9418 reads
From a vicious to a virtuous circle in the Eurozone - the time is ripe
Marco Buti, Pier Carlo Padoan, 27 March 2012
The economic and financial crisis in the Eurozone is in its fourth year. In late 2011, it had evolved dangerously into a vicious circle of sluggish growth, tensions in sovereign debt markets and banking sector fragility.
Topics: Macroeconomic policy
Tags: eurozone, fiscal consolidation, growth
Fiscal consolidations for debt-to-GDP ratio containment? Maybe … but with much care
Gianluca Cafiso, Roberto Cellini, 20 March 2012
In recent time a wide debate has been developing concerning the effects of restrictive fiscal policies on the dynamics of the debt-to-GDP ratio (eg Corsetti and Müller 2012). The debate is nourished by the current experience of EU countries, where fiscal-consolidation policies are implemented.
Topics: Macroeconomic policy
Tags: austerity, debt, eurozone
Fed versus ECB: How Target debts can be repaid
Hans-Werner Sinn, 10 March 2012
Now that Bundesbank President Jens Weidman has expressed his concern about the rising TARGET balances within the Eurozone in an official letter to Mario Draghi, the issue can no longer be swept under the carpet. In February, the Bundesbank had a TARGET claim of €547 billion on the Eurosystem, while the Dutch central bank had one of €171 billion in January.
Topics: International finance
Tags: ECB, eurozone, TARGET2
Brinkmanship in Brussels, Sturm and Drachma for Greece and Europe
Jacob Funk Kirkegaard, 1 March 2012
Just as it did when Congress recently extended the payroll tax cut, brinkmanship has produced an early-morning deal in Europe to extend a new lifeline to Greece and clear the way for the biggest sovereign bond restructuring in history.
Topics: International finance
Tags: eurozone, Greece, IMF
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