Bibow, J. (2014) “On The Alleged Pains of the Strong Euro“, Social Europe Journal, 03 Απριλίου. Since its most recent low of $1.20, reached in the heat of the summer of 2012, the euro has appreciated by 15 percent against the US dollar and by more than 10 percent in inflation-adjusted terms against a broad basket of currencies representative of the euro area’s main trading partners. Amounting to a …Read More
The Global Economy in 2030: Trends and Strategies for Europe
Gros, D. & Alcidi, C. (2014) “The Global Economy in 2030: Trends and Strategies for Europe“, Economic Policy, CEPS Paperbacks, 02 Απριλίου. This groundbreaking study concentrates on a set of critical economic factors that will shape future economic growth at the global level and offers a description of the possible evolution of their reach and scope. Our goal in pursuing this research is not to make precise predictions about …Read More
Orderly debt reduction rather than permanent mutualisation is the way to go
Vihriälä, V. & Weder di Mauro, B. (2014) “Orderly debt reduction rather than permanent mutualisation is the way to go“, VoxEU Organisation, 02 Απριλίου. The EZ debt overhang needs to be fixed. This column argues that making market discipline credible requires an orderly debt restructuring mechanism combined with a strictly regulated temporary mutualisation scheme or a well-designed debt conversion scheme. This combination could reduce the current debt overhang in …Read More
Europe’s social problem and its implications for economic growth
Darvas, Z. & Wolff, B. G. (2014) “Europe’s social problem and its implications for economic growth“, Bruegel Policy Brief, 01 Απριλίου. The European Union faces major social problems. More than six million jobs were lost from 2008-13 and poverty has increased. Fiscal consolidation has generally attempted to spare social protection from spending cuts, but the distribution of adjustment costs between the young and old has been uneven; a growing …Read More
What has been agreed on banking union risks reigniting, rather than resolving the crisis
Begg, I. (2014) “What has been agreed on banking union risks reigniting, rather than resolving the crisis“, LSE, Euro Crisis in the Press, 02 Απριλίου. In December 2013 EU finance ministers negotiated an agreement aimed at establishing a banking union, with further talks between the European Parliament and the Member States ending in an agreement last week. Iain Begg provides a detailed overview of the main objectives of banking …Read More
Understanding the Confidence Fairy
Smith, Y. (2014) “Understanding the Confidence Fairy“, MacroBusiness, 1 Απριλίου. One strange claim in the economic debate that followed the financial crisis was the impact of uncertainty on the path of investment and subsequently the recovery in economic activity. Taking just one example, it was claimed here that “fiscal policy uncertainty has directly harmed the American economy by increasing the unemployment rate by 0.6%, or the equivalent of 900,000 …Read More
Kapital for the Twenty-First Century?
Piketty, T. (2014) “Kapital for the Twenty-First Century?“, Belknap Press, 2014, 671 pp. What is “capital”? To Karl Marx, it was a social, political, and legal category—the means of control of the means of production by the dominant class. Capital could be money, it could be machines; it could be fixed and it could be variable. But the essence of capital was neither physical nor financial. It was the …Read More
Fiscal adjustment and growth: Beware of the credit constraints
Baldacci, E., Gupta, S., Mulas-Granados, C. (2014) “Fiscal adjustment and growth: Beware of the credit constraints“, VoxEU Organisation, 31 Μαρτίου. The recent debate on the link between austerity and growth has focused on the short run. This column discusses recent research into the link between fiscal consolidation and medium-term growth under different financial conditions. If credit is not available to consumers and investors, private demand is less able to …Read More
Delivering the Eurozone ‘Consistent Trinity’
Buti, M., Demertzis, M. & Nogueira Martins, J. (2014) “Delivering the Eurozone Consistent Trinity“, VoxEU Organisation, 30 Μαρτίου. Although progress has been made on resolving the Eurozone crisis – vulnerable countries have reduced their current-account deficits and implemented some reforms – more still needs to be done. This column argues for a ‘consistent trinity’ of policies: structural reforms within countries, more symmetric macroeconomic adjustment across countries, and a banking …Read More
Changing Identity: Retiring From Unemployment
Hetschko, C., Knabe, A. & Schöb, R. (2014) “Changing Identity: Retiring From Unemployment”, The Economic Journal, 124: 149–166, Μάρτιος. Using German panel data, we show that unemployed people are, on average, less satisfied with their life than employed people, but they report a substantial increase in their life satisfaction upon retirement. We interpret this finding using identity theory. Retirement raises the identity utility of the unemployed because it changes the …Read More