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?
Too early to sound the alarm
Manfred J M Neumann, 17 April 2012
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).
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.
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 .  http://voxeu.org/sites/default/files/file/PolicyInsight61.pdf
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.
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.
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.
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.
Apart from the fiscal compact – on competitiveness, nominal wages and labour productivity
Marga Peeters, Ard den Reijer, 3 January 2012
Eurozone members that face the consequences of severe asymmetric shocks can, in the absence of labour mobility, accommodate by means of fiscal transfers. In order to avoid becoming a one-way transfer union from the core to the periphery, the EU needs to address structural imbalances and persistent current-account deficits and surpluses that are due to real exchange-rate misalignment.
Deleveraging in the Eurozone
Vincent O'Sullivan, Stephen Kinsella, 17 December 2011
The capital shortfall at EU banks is 8% higher than originally thought, according to the latest assessment from the European Banking Authority (EBA 2011) released on 8 December.
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CEPR Policy Research
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- The roots of shadow bankingPerotti
- What’s wrong with Europe?Baldini, Manasse
- Corporate Finance Theory Symposium19 - 20 September 2014 / Cambridge / Judge Business School, Cambridge University
- International Trade, Finance, and Macroeconomics: Research Frontiers and Challenges for Policy18 - 19 December 2014 / The Bank of England, London / The Bank of England, Centre for Macroeconomics and CEPR