Schoenmaker, Dirk, (2017), “A macro approach to international bank resolution”, Bruegel, 10 July As regulators rush to strengthen banking supervision and implement bank resolution regimes, a macro approach to resolution is needed that considers both the contagion effects of bail-in and the continuing need for a fiscal backstop to the financial system. This can be facilitated through the completion of a banking union in which the European Stability Mechanism (ESM) …Read More

Sapir, Andre, Schoenmaker, Dirk, (2017), “We need a European Monetary Fund, but how should it work?”, Bruegel, 29 May Many voices are calling for the ESM to be developed into a fully-fledged European Monetary Fund. But what changes would this entail, and how could the new institution be governed? The authors see both need and hope for change. Relevant Posts Merler, Silvia,Schoenmaker, Dirk, Véron, Nicolas, (2017), «How will Europe’s banking …Read More

Rinaldi, David, Núñez Ferrer, Jorge, (2017), “The European Fund for Strategic Investments as a New Type of Budgetary Instrument”, CEPS Research Report No 2017/07, 5 April This paper provides an overview of the European Fund for Strategic Investments (EFSI) as a budgetary instrument. A preliminary analysis of the quantitative impact of its first year and a half of activity is complemented by an outline of the corollary policies that can …Read More

Baker, Dean, (2017), “Financial Transactions Taxes Make the Economy More Efficient”, CEPR, 3 April The government of Belgium is arguing that trades by these funds should not be subject to the tax. This objection makes little sense if the goal of the Belgium government is actually to protect the pension funds. Of course it is a great line of argument if the point is to sabotage the FTT while appearing to …Read More

ECB Banking Supervision, (2017), “Guidance to banks on non-performing loans”, ECB, March A number of banks in Member States across the Euro area are currently experiencing high levels of non-performing loans (NPLs). There is broad consensus on the view that high NPL levels ultimately have a negative impact on bank lending to the economy1 , as a result of the balance sheet, profitability, and capital constraints faced by banks with …Read More

Banerji, Angana, Dabla-Norris, Era, Duval, Romain, Furceri, Davide, (2017), “The Case for Fiscal Policy to Support Structural Reforms”,IMF, 13 March Many advanced countries need  structural reforms to make their economies more productive and raise long-term living standards.  Our new research shows that provided countries can afford it, fiscal policy, through spending or tax incentives, can help governments overcome some obstacles to the reforms, particularly in the early stages.   Structural reforms …Read More

Merler, Silvia, (2017), “European identity and the economic crisis”, Bruegel, 6 March Ferrera looks into what it means to be a European, and argues that integration proceeded so as to favour the emergence of a pan-European elite identity, while the inherited weight and inertia of national cultural frameworks prevented the emergence of a deeper sense of common citizenship across the EU. The ‘econo-cracy’ and austerity politics of the recent crisis years …Read More

Cecchetti, Stephen, Schoenholtzm Kim, (2017), “GDP-linked bonds: A primer “, VoxEu, 1 March Policymakers and economists have been looking for ways to make it easier to manage increasing debt burdens. This column assesses one possible solution: GDP-linked bonds that tie the size of debt payments to an economy’s wellbeing. There are clear benefits to a government from issuing GDP-linked bonds, but establishing investor confidence in these instruments will require a …Read More