Garcia-Herrero, Alicia, Turegano, David Martinez, (2017), “Who would bet on currency unions after EMU crisis?”, Bruegel, 29 March The recent years of crisis have made clear that real convergence in the euro area has been insufficient to prevent stress through asymmetric shocks. Following this experience, and building on earlier work, we assess the opportunities for current union in the two most promising integration processes in the emerging world: ASEAN and the …Read More

Vox Eu, (2017), “The first CEPR Flashback: Flexible Integration: Towards a More Effective and Democratic Europe”, Vox Eu, 30 March This is the first “CEPR Flashback” – a new series of short Vox columns that highlight the current relevance of past CEPR reports. Since 1983, CEPR reports have often been ahead of the curve in anticipating and analysing problems in Europe and beyond. Looking back, it is clear that much of …Read More

Heil, Mark, (2017), “Finance And Productivity: A Literature Review Economics Department Working Papers No. 1374”, OECD, 21 February This paper surveys a broad range of studies and highlights the main findings of the empirical literature regarding business finance and productivity. Numerous studies analyse the productivity effects of financial development and frictions. The results suggest: 1) Financial development likely has favourable effects on productivity growth; 2) financial frictions that impede the …Read More

Bongaerts, Dion, Schoenmaker, Dirk , (2017), “A call for uniform sovereign exposure limits”, Bruegel, 28 March In recent years we have seen sovereign financial problems spilling into the banking sector because the banking sectors have held a very large share of the domestic sovereign debt. This is clearly not desirable. First, by buying these domestic sovereign bonds, the banking sector allows governments to overspend. Second, the excess bad sovereign debt crowds …Read More

Feliu, Justine, (2017), “Why was the last TLTRO take-up unexpectedly high?”, Bruegel, 27 March Last week the ECB published data about the take up of the fourth and last tranche of funding from the second Targeted Long-Term Refinancing Operation (TLTRO 2.0). The data showed an unexpectedly large demand for liquidity from euro area banks. In total, EUR233.47bn was allotted to 474 Eurozone banks. Although the level of liquidity in the Eurozone …Read More

Emmanouilidis, Janis A., Zuleeg, Fabian , (2017), “The Rome Declaration – An imperfect display of unity”, EPC, 27 March On 25 March 2017, the leaders of the European Union (EU) came together to celebrate the 60th anniversary of the Rome Treaties. The EU and its members had good reasons to celebrate. The European integration process has been the product of grand aspirations inspired by the imagination of pragmatic visionaries, born of …Read More

Gilbert, Mark, (2017), “Euro-Zone Growth Pessimists Will Be Proved Wrong (Again)”, Bloomberg, 28 March We’ve seen this movie before. Last year, the average forecast of economists was for the euro zone to post a growth rate of a bit more than 1.5 percent; instead, gross domestic product expanded by 1.7 percent. The economy displayed a similar out-performance in 2015, with an average forecast for the year of 1.4 percent outpaced …Read More

Caldera, Aida, De Serres, Alain , Gori, Filippo , Röhn, Oliver, (2017), “Economic resilience: Trade-offs between growth and economic fragility”, Vox EU, 28 March Major global crises such as the 2008-09 episode are rare, but severe recessions have been quite frequent over the past four decades, often with a large cumulated cost in terms of foregone income and high unemployment. Figure 1 shows the incidence of different crisis types (banking, currency, …Read More

Batsaikhan, Uuriintuya, Darvas, Zsolt, (2017),  “European spring – Trust in the EU and democracy is recovering”, Bruegel, 24 March Increased support for populistic movements in the world’s richer countries is typically explained by two types of disappointment: economic insecurity and cultural backlash. Economic insecurity is fuelled by various factors, such as increased unemployment, slow wage growth or even wage drops, fears of ‘robotisation’, and cuts in social support through fiscal …Read More