Getting eurozone deposit insurance right promises benefits

11 January, 2016

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Wolff, Guntram, (2016), “Getting eurozone deposit insurance right promises benefits”, Bruegel, 5 January The European Commission presented its proposals for European deposit insurance last November. Officials hope to stabilise the banking system and decouple banks’ financing costs from the solvency of their host states. This would achieve the original aim of Banking Union: to break the link between states and their banking systems. Relevant Posts Gros, Daniel, Belke, Ansgar, (2015), …Read More

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Farewell to the vultures? Argentine debt restructuring and bargaining theory

8 January, 2016

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Miller, Marcus, Ghosal, Sayantan, (2016), “Farewell to the vultures? Argentine debt restructuring and bargaining theory”, Voxeu, 8 January. Shylock’s insistence in ‘The Merchant of Venice’ that his “pound of flesh” be paid as per the contract, regardless of the extreme and grotesque cost to the debtor, is an apt parallel with vulture funds holding out on Argentinian debt pay-outs. This column assesses the Argentinian debt situation and develops an accord that would …Read More

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Capital shares and income inequality: Evidence from the long run

8 January, 2016

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Bengtsson, Erik, Waldenström, Daniel, (2015), “Capital shares and income inequality: Evidence from the long run”, Centre for Economic Policy Research, December. This paper investigates the relationship between the capital share in national income and personal income inequality over the long run. Using a new historical cross-country database on capital shares in 19 countries and data from the World Top Income Database, we find strong long-run links between the aggregate role of capital …Read More

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Deleveraging, deflation and depreciation in the euro area

8 January, 2016

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Kuvshinov, Dmitry, Müller, Gernot, Wolf, Martin, (2015), “Deleveraging, deflation and depreciation in the euro area”, Centre for Economic Policy Research, December. During the post-crisis period, economic performance has been highly heterogenous across the euro area. While some economies rebounded quickly after the 2009 output collapse, others are undergoing a protracted further decline as part of an extensive deleveraging process. At the same time, inflation has been subdued throughout the whole of the euro area and intra-euro-area …Read More

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Income changes and their determinants over the lifecycle

8 January, 2016

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Hood, Andrew, Joyce, Robert, (2015), “Income changes and their determinants over the lifecycle”, IFS Working Paper, 21 December. What explains the variation in how income changes as people age? Using household panel data, we investigate the contribution of different time-varying factors in explaining variation in income changes over prime working-age life (between 35-44 and 50-59). We find that demographic changes, such as acquiring or losing a partner and the entry or exit of …Read More

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Greece’s Two Currencies

8 January, 2016

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Varoufakis, Yanis, (2016), “Greece’s Two Currencies”, Social Europe, 8 January. Imagine a depositor in the US state of Arizona being permitted to withdraw only small amounts of cash weekly and facing restrictions on how much money he or she could wire to a bank account in California. Such capital controls, if they ever came about, would spell the end of the dollar as a single currency, because such constraints are utterly …Read More

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Banking Union as a Shock Absorber: Lessons for the eurozone from the US

7 January, 2016

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Gros, Daniel, Belke, Ansgar, (2015), “Banking Union as a Shock Absorber: Lessons for the eurozone from the US”, CEPS publications, 17 December This book illustrates how the structure of the US banking market and the existence of federal institutions allowed regional financial shocks to be absorbed at the federal level in the US, thus avoiding local financial crisis. The authors argue that the experience of the US shows the importance of …Read More

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Another Slow Year for the Global Economy

5 January, 2016

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Mody, Ashoka, (2016), “Another Slow Year for the Global Economy”, Project Syndicate, 4 January Last April, the International Monetary Fund projected that the world economy would grow by 3.5% in 2015. In the ensuing months, that forecast was steadily whittled down, reaching 3.1% in October. But the IMF continues to insist – as it has, with almost banal predictability, for the last seven years – that next year will be better. …Read More

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Law and Economics-Philosophical Issues and Fundamental Questions

5 January, 2016

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Hatzis, Aristides N., Mercuro, Nicholas (2015), “Law and Economics-Philosophical Issues and Fundamental Questions”, Routledge publications, November. The Law and Economics approach to law dominates the intellectual discussion of nearly every doctrinal area of law in the United States and its influence is growing steadily throughout Europe, Asia, and South America. Numerous academics and practitioners are working in the field with a flow of uninterrupted scholarship that is unprecedented, as is its influence …Read More

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Designing tax policy in high-evasion economies

5 January, 2016

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Best, Michael, Brockmeyer, Anne, Kleven, Henrik, Spinnewijn, Johannes, Waseem, Mazhar, (2016) “Designing tax policy in high-evasion economies”, VoxEU, 5 January Developing economies are characterised by low tax revenue and widespread tax evasion. This column assesses what tax policy instruments governments should use to raise revenue. Optimal tax policy in developing countries may diverge from what is prescribed in standard textbook models. A turnover tax, for instance, is known to distort …Read More

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