Mody, A. (2014) “The OMT’s fragile foundations“, VoxEU Organisation, 09 Σεπτεμβρίου. Earlier this year, the German constitutional court declared the OMT programme to be inconsistent with EU’s law. This column reviews the legal framework and economic foundation of the OMT. Without any changes in the political structure, the OMT invokes moral hazard in the actions of the member states and unfairness in the distributing the burden of distress. Earlier …Read More
Why does Italy not grow? – The Italian economy has barely grown since it joined the euro area in 1999
Mody, Α. & Riley, Ε. (2014) “Why does Italy not grow? – The Italian economy has barely grown since it joined the euro area in 1999“, Bruegel Institute, 09 Σεπτεμβρίου. In April this year, the Italian debt-to-GDP ratio was expected to peak by year-end at 135 percent of GDP. That projection assumed a real GDP growth rate of 0.6 percent and inflation of about 0.7 percent. The projected decline …Read More
Facing Reality in the Eurozone
Turner, Α. (2014) “Facing Reality in the Eurozone“, Project Syndicate, 08 Σεπτεμβρίου. European Central Bank President Mario Draghi’s recent speech at the annual gathering of central bankers in Jackson Hole, Wyoming, has excited great interest, but the implication of his remarks is even more startling than many initially recognized. If a eurozone breakup is to be avoided, escaping from continued recession will require increased fiscal deficits financed with ECB money. …Read More
Βιβλιοθήκη » EE » Οικονομία » Άρθρα Γνώμης
Quantitative Easing Or Business Easing In Europe?
Janssen, R. (2014) “Quantitative Easing Or Business Easing In Europe?“, Social Europe Journal, 08 Σεπτεμβρίου. A political “consensus” is at this moment being forged in the Euro Area around a policy mix where the ECB would go for some form of, yet undefined, quantitative easing and this in exchange for radical structural reforms. To push this view through, it seems as if anything is allowed. A rather hallucinating illustration …Read More
A ‘sovereign subsidy’ – zero risk weights and sovereign risk spillovers
Korte, J. & Steffen, S. (2014) “A ‘sovereign subsidy’ – zero risk weights and sovereign risk spillovers“, VoxEU Organisation, 07 Σεπτεμβρίου. European banking regulation assigns a risk weight of zero to sovereign debt issued by EU member countries, making it an attractive investment for European banks. This column defines a ‘sovereign subsidy’ as a new measure quantifying to what extent banks are undercapitalised due to the zero risk weights. …Read More
Juncker, Tusk, Mogherini and the EU’s credibility crisis
Schweiger, C. (2014) “Juncker, Tusk, Mogherini and the EU’s credibility crisis“, Ideas on Europe Blog, 07 Σεπτεμβρίου. After months of public wrangling and backroom discussions over the selection of the candidates for the vacancies of key institutional posts the EU is now finally in a position to address its mounting internal and external challenges with a new guard of official representatives. The selection process itself resembled very much the …Read More
Super Mario: 1up? – the ECB cuts the three reference rates and introduces a private asset purchase programme
Merler, S. (2014) “Super Mario: 1up? – the ECB cuts the three reference rates and introduces a private asset purchase programme“, Bruegel Think Tank, 05 Σεπτεμβρίου. The stake at this month’s meeting of the ECB’s Governing Council was exceptionally high. Mario Draghi himself raised the bar of expectations, with his intervention at Jackson Hole. That speech marked a significant change in his language, on a number of important dimensions. …Read More
The ECB Throws down the Gauntlet
Kirkegaard, F. J. (2014) “The ECB Throws down the Gauntlet“, The Peterson Institute for International Economics, 05 Σεπτεμβρίου. The European Central Bank (ECB) surprised financial markets on September 4 by announcing an interest rate cut of 10 basis points, a new program to purchase asset-backed securities (ABS) in the nonfinancial sector, and another round of purchases of covered bank bonds. The ECB was responding not only to the recent …Read More
Europe’s Center of Power Shifts East
Bershidsky, L. (2014) “Europe’s Center of Power Shifts East“, Bloomberg Views, 04 Σεπτεμβρίου. As Jean-Claude Juncker assumes its presidency, the European Commission — Europe’s de-facto government — will ostensibly be run by representatives of the bloc’s newest, post-Communist members, but there will no longer be a commissioner for EU expansion. Europe needs time to heal, consolidate and reorient itself politically and economically. The reorientation appears to be along unfashionably …Read More
Βιβλιοθήκη » EE » Πολιτική » Άρθρα Γνώμης
Which factors shape the relationship between manufacturing and government wages?
Marzinotto, Β. & Turrini, Α. (2014) “Which factors shape the relationship between manufacturing and government wages?“, VoxEU Organisation, 05 Σεπτεμβρίου. The link between public- and private-sector compensation has important implications for the labour market and price competitiveness. This column reports that manufacturing and government wages co-move both in the long and short run, but that the long-run co-movement is much stronger where the government is an important employer. This …Read More