Quaglia, Lucia, Royo, Sebastian, (2014), “Banks and the political economy of the sovereign debt crisis in Italy and Spain“, CES papers
This paper sets out to explain why Spain experienced a full-fledged sovereign debt crisis and had to resort to euroarea financial assistance for its banks, whereas Italy did not. It undertakes a structured comparison, dissecting the sovereign debt crisis into a banking crisis and a balance of payments crisis. It argues that the distinctive features of bank business models and of national banking systems in Italy and Spain have considerable analytical leverage in explaining the different scenarios of the crises in each country. This ‘bank-based’ analysis contributes to the flourishing literature that examines changes in banking with a view to account for the differentiated impact of the global banking crisis first and the sovereign debt crisis in the euroarea later.
Relevant Posts
- European Commission, (2016), “The Economic Impact of Selected Structural Reform Measures in Italy, France, Spain and Portugal”, Institutional Paper 023, April
- Perez, Sofia, (2014), “Eurozone crisis and social models: what we can learn from Italy and Spain”, Minda de Ginzburg Center for European Studies, Harvard University, Open Forum Working Papers #20,