Maria Demertzis, André Sapir and Guntram Wolf, (2019), “Promoting sustainable and inclusive growth and convergence in the European Union”, Bruegel Policy Contribution Issue No 7, April The European Union can look ahead at the next five years from a good economic position. Employment is comparatively high, the recovery has been uninterrupted for several years and income inequality remains less pronounced than elsewhere in the world. But the EU faces nevertheless …Read More
Europe and the New Imperialism
Jean Pisani-Ferry, (2019), “Europe and the New Imperialism”, Project Syndicate, 1 April For decades, Europe has served as a steward of the post-war liberal order, ensuring that economic rules are enforced and that national ambitions are subordinated to shared goals within multilateral bodies. But with the United States and China increasingly mixing economics with nationalist foreign-policy agendas, Europe will have to adapt. Relevant Posts Christine Lagarde, (2019), «The Euro Area: …Read More
A Delicate Moment for the Global Economy: Three Priority Areas for Action
Christine Lagarde, (2019), “A Delicate Moment for the Global Economy: Three Priority Areas for Action”, IMF, 2 April In January, the IMF projected global growth for 2019 and 2020 at around 3 ½ percent—less than in the recent past, but still reasonable. It has since lost further momentum, as you will see from our updated forecast next week. Only two years ago, 75 percent of the global economy experienced an …Read More
Macroprudential policy in a monetary union with cross-border banking
Matthieu Darracq Pariès, Christoffer Kok and Elena Rancoita, (2019), “Macroprudential policy in a monetary union with cross-border banking”, ECB Working Paper Series No2260, March We analyse the interaction between monetary and macroprudential policies in the euro area by means of a two-country DSGE model with financial frictions and cross-border spillover effects. We calibrate the model for the four largest euro area countries (i.e. Germany, France, Italy, and Spain), with particular …Read More
Greece Mulls Early IMF Repayment as Aid Tranche Nears
Sotiris Nikas and Viktoria Dendrinou, (2019), “Greece Mulls Early IMF Repayment as Aid Tranche Nears”, Bloomberg, 2 April Greece’s plans to repay part of its loans from the International Monetary Fund ahead of schedule may soon come to fruition, paving the way for the debt-stricken nation to claim it has taken another step toward economic normalcy. Relevant Posts Theodore Pelagidis, (2019), «Greek economy: From bailout program exit to recovery?», Brookings, …Read More
What if Zero Interest Rates Are the New Normal?
Adair Turner, (2019), “What if Zero Interest Rates Are the New Normal?”, Project Syndicate, 29 March The valid insight behind “modern monetary theory” – that governments and central banks together can always create nominal demand – was explained by Milton Friedman in 1948. But it is vital also to understand that excessive monetary finance is hugely harmful, and it is dangerous to view it as a costless way to solve …Read More
On the credit and exchange rate channels of central bank asset purchases in a monetary union
Matthieu Darracq Pariès and Niki Papadopoulou, (2019), “On the credit and exchange rate channels of central bank asset purchases in a monetary union “, ECB Working Paper Series No 2259, March Through the euro area crisis, financial fragmentation across jurisdictions became a prime concern for the single monetary policy. The ECB broadened the scope of its instruments and enacted a series of non-standard measures to engineer an appropriate degree of …Read More
The Euro Area: Creating a Stronger Economic Ecosystem
Christine Lagarde, (2019), “The Euro Area: Creating a Stronger Economic Ecosystem”, IMF, 28 March Twenty years ago, European countries did not just plant one tree, they planted an entire forest—creating a new economic ecosystem known as the euro area. The fundamental strength of that system lies in its interconnectedness and diversity—a combination that can help Europe to fully unlock its immense economic potential. Relevant Posts Jan Priewe, (2019), «Could Europe …Read More
The European Union’s response to the trade crisis
Uri Dadush and Guntram Wolff, (2019), “The European Union’s response to the trade crisis”, Bruegel, Policy Contribution, Issue No 5, March The global trading system, a source of prosperity, is under attack on various fronts. The causes run deep and require a strategic response from the European Union and from the main trading nations. The future of the system hinges on the answer to three questions, and the scenarios associated …Read More
The Eurozone’s Real Weakness
Lucrezia Reichlin, (2019), “The Eurozone’s Real Weakness”, Project Syndicate, 28 March A new eurozone crisis would most likely have a less uneven effect than in 2008 or 2011, not least because its largest economies are currently weak. But if a recession hits, policymakers will find it hard to mount an effective response. Relevant Posts Jan Priewe, (2019), «Could Europe face the next recession?», Social Europe, 19 March Paul Taylor, (2019), «Why …Read More