Davies, Howard, (2016), “Taking Monetary Policy to the People”, Project Syndicate, 25 October For the last 20 years, central-bank independence has marked a kind of “end of history” for monetary policy, after many other regimes were tried and failed. In the years before the 2008 global financial crisis, independent central banks were seen as successful in controlling inflation; and countries with sizable fiscal deficits were especially enthusiastic about central-bank independence …Read More

Merler, Silvia, (2016), “Should we rethink fiscal policy?”, Bruegel, 24 October What’s at stake: there has been quite some discussion recently on whether we should rethink the framework of fiscal policy in order to make it more appropriate and effective in a world where demand seems to be chronically anemic, inflation is low and the interest rates are likely to stay close to zero (if not negative) for a long …Read More

Véron, Nicolas, (2016), “Breaking the vicious circle”, Bruegel, 21 October The eurozone’s banking union has moved from vision to reality in a short period of time, with the European Central Bank now an established supervisory authority for the area’s large banks. This has already made a big difference to the many national banking champions that local supervisors had been treating with kid gloves. But the banking union’s ultimate policy goal, …Read More

Bofinger, Peter,Scheuermeyer, Philipp, (2016), “Income distribution and aggregate saving: New evidence”, VoxEu, 20 October The effect of income distribution on aggregate saving has important implications for aggregate demand and global current account imbalances.  Drawing on evidence from a panel of high-income OECD countries, this column documents a hump-shaped relationship between inequality and aggregate saving rates. It also shows that the relationship between inequality and saving depends on financial market conditions. …Read More