Ball, L. (2014) “The Great Recession’s long-term damage“, VoxEU Organisation, 01 Ιουλίου.   Whereas textbook macroeconomic theory suggests that output should return to potential after a recession, there is mounting evidence that deep recessions have highly persistent effects on output. This column reports estimates of the long-term damage caused by the Great Recession. In most countries in the sample, the loss of potential output – 8.4% on average – has …Read More

M. Buch, C., Chapman, J. & Goldberg, L. (2014) “Transmission of liquidity risk through global banks: An International Banking Research Network project“, VoxEU Organisation, 24 Ιουνίου.   The international transmission of liquidity shocks is one of the key questions of banking globalisation. This column discusses a project of central bank researchers from around the world who have been exploring the role of global banks in the transmission of liquidity shocks. …Read More

Darvas, Z. & Hüttl, P. (2014) “The long haul: debt sustainability analysis“, Working Paper – European Macroeconomics, Bruegel Association, 18 Ιουνίου.   This working paper details and updates the debt sustainability analysis of Darvas, Sapir and Wolff (2014) for Greece, Ireland and Portugal. The goal is not the calculation of a baseline scenario which best corresponds to our views, but to set-up a baseline scenario which broadly corresponds to official …Read More

Illing, G. (2014) “Should the Euro Area Be Concerned About Deflation?“, INTERECONOMICS, Vol 49, No. 3· Μάιος/ Ιούνιος 2014.   During the past few years, headline inflation (the change in the harmonised consumer price index, HCPI) in the euro area has fallen steadily, from three per cent at the end of 2011 to 0.7 per cent in April 2014. It is now far below the ECB’s target rate of inflation …Read More

Kahn, R. (2014) “Lowflation: Should We Fear Stable Prices?“, Global Economics Monthly: June 2014, Council on Foreign Relations, 10 Ιουνίου.   Overview: Bottom Line: Low inflation may be symptomatic of deeper problems, such as inadequate demand or central bank policy failures. The costs of low inflation could be high for European economies. There is a new Washington consensus, and it consists of a simple message: low inflation threatens the global …Read More

Murphy, D., Vasios, M. & Vause, N. (2014) “An investigation into the procyclicality of risk-based initial margin models“, VoxEU Organisation, 06 Ιουνίου.   Initial margin models are often procyclical, raising margin requirements at times of market stress, which can exacerbate that stress. This column proposes quantitative measures of procyclicality both over the cycle and over liquidity planning horizons. If market participants disclosed these procyclicality measures of their margin models, this …Read More

Sadeh, T. (2014) “The euro’s effect on trade“, European Union Politics, Vol. 15, No. 2, Ιούνιος.   This study argues that the euro area more than doubled trade among its members, but this process was delayed and fitful. The estimates in this article are close to those obtained by Rose and Frankel, despite the usage of methods developed by their critics. Furthermore, the euro area has increased the trade of …Read More

Gropas, R. & Triandafyllidou, Α. (2014) “’Voting With Their Feet’, Highly Skilled Emigrants From Southern Europe”, American Behavioral Science (ABS), Ιούνιος.   In this article, the authors present new empirical data on highly skilled emigrants from two southern European countries, Italy and Greece, which have been particularly hit by the global financial and Eurozone crisis. The data have been generated by an e-survey conducted in late spring and summer 2013. …Read More

Magud, N. & Vesperoni, R. E. (2014) Exchange-rate flexibility and credit during capital inflow deversals: Purgatory… not paradise, VoxEU Organisation, 30 Μαΐου.   Expansionary monetary policy in advanced economies have created capital inflow booms in emerging markets. This column analyses the effect of exchange rate flexibility on credit markets during capital inflow booms. In economies with less flexible exchange rate regimes, credit grows faster and more towards foreign currency. These …Read More