Economists have been widely reviled in the popular press for failing to predict the current financial crisis. To some extent, this criticism is unfair. As David K. Levine (2009) has argued, future economic outcomes are functions of future fundamental random variables.
A systemic risk warning system
Anne Sibert, 16 January 2010
Eurozone monetary policy in uncharted waters
Emil Stavrev, Martin Cihák, Thomas Harjes, 15 January 2010
In response to the financial crisis and its fallout on economic activity, inflation, and inflation expectations, central banks around the globe flooded markets with liquidity and slashed interest rates to unprecedented low levels. The ECB led the way in actively providing financial markets with massive amounts of liquidity.
What explains the surge in euro-area sovereign spreads during the financial crisis of 2007-09?
Cristina Checherita, Maria Grazia Attinasi, Christiane Nickel, 11 January 2010
Since the intensification of the financial crisis in September 2008 through March 2009, long-term government bond yield spreads relative to Germany have increased dramatically for most Eurozone countries (Sgherri and Zoli 2009, De Grauwe 2009, Schuknecht 2009).
Greece: The start of a systemic crisis of the Eurozone?
Paul De Grauwe, 11 May 2010
The Greek crisis has led to fears that this is only the beginning of a deeper sovereign debt crisis that could ultimately destabilise the Eurozone. Are these fears exaggerated? How to deal with these problems? These are some of the questions many observers have been asking themselves.
Should Sweden join the Eurozone?
J James Reade, Ulrich Volz, 8 September 2009
The Swedish euro debate disappeared following the negative outcome of the 2003 referendum, but the current global financial crisis has revived euro deliberations in Sweden.
The politics of the Maastricht convergence criteria
Paul De Grauwe, 15 April 2009
The stern judges of economic orthodoxy have ruled from Frankfurt. The entrance criteria for the new EU members that would like to join the Eurozone should not be relaxed. Strict adherence to the rules should be maintained, lest the Eurozone itself be endangered.
Why should we believe the market this time?
Paul De Grauwe, 7 February 2009
Spreads of sovereign debt within the eurozone have increased dramatically during the last few months. Figure 1 shows the evidence. The governments of Greece and Ireland now pay an interest rate on their debt that exceeds the German government bond rate by more than 200 basis points, while the governments of Spain, Portugal and Italy have to pay more than 100 basis points extra.
The microeconomic impacts of the euro
Lionel Fontagné, Antoine Berthou, 9 August 2008
Economists sometimes happen to reach conclusions at odds with common sense. Regarding monetary integration, a widely quoted paper suggested very large trade creation effect of adopting a single currency: a common currency would raise trade by 235% (Rose, 2000).
The euro: love it or leave it?
Barry Eichengreen, 4 May 2010
The world economy is continually changing, but one constant is dissatisfaction with the euro. Toward the beginning of the decade, the main complaint was that the euro was too weak for booming economies like Ireland. Now the complaint is that it is too strong for growth-challenged countries like Italy.
Europe must relax its inflation test for euro entrants
Willem Buiter, Anne Sibert, 3 May 2006
Estonia, Lithuania, Slovenia, Latvia and Slovakia have joined the exchange rate mechanism of the European monetary union and are candidates for near-term Eurozone membership. Estonia, Lithuania and Slovenia hope to join the Eurozone next January, Latvia in 2008 and Slovakia in 2009.
- The case for 4% inflationBall
- The banking crisis as a giant carry trade gone wrongAcharya, Steffen
- Everything the IMF wanted to know about financial regulation and wasn’t afraid to askBair
- Rethinking macroeconomic policy: Getting granularBlanchard, Dell'Ariccia, Mauro
- Iceland’s post-Crisis economy: A myth or a miracle?Danielsson
- A tale of two depressions: What do the new data tell us? February 2010 updateEichengreen, O’Rourke
- Educated in America: College graduates and high school dropoutsHeckman, LaFontaine
- Eurozone breakup would trigger the mother of all financial crisesEichengreen
- Panic-driven austerity in the Eurozone and its implicationsDe Grauwe, Ji
- Debt, deleveraging, and the liquidity trap: A new modelKrugman
Baldwin, Kawai, Wignaraja, 11 June 2013
Giavazzi, Portes, Weder di Mauro, Wyplosz
CEPR Policy Research
- The "Greatest" Carry Trade Ever? Understanding Eurozone Bank RisksAcharya, Steffen
- Political Credit Cycles: The Case of the Euro ZoneFernández-Villaverde, Garicano, Santos
- Winning by Losing: Incentive Incompatibility in Multiple QualifiersDagaev, Sonin
- Income and schoolingBrückner, Gradstein
- Monetary Policy and Rational Asset Price BubblesGalí