Bouthevillaina, Carine, Dufrénotb, Gilles, (2016), “Fiscal policies enhancing growth in Europe: does one size fit all?”, Oxford Economic Papers, 2 June This paper provides evidence of various reactions of growth rates to changes in the composition of taxes and public spending in Europe. We use a quantile estimator to allow different slopes of fiscal variables, across countries and years. We find that sovereign spending should be encouraged in the medium term …Read More

Andrésa, Javier, Boscáb, José E., Ferric, Javier, (2016), “Instruments, rules, and household debt: the effects of fiscal policy”, Oxford Economic Papers, 4 February We look at the interplay between the level of household debt and fiscal policy. When the fiscal rule is defined in lump-sum transfers, government spending or consumption taxes, the impact multipliers of fiscal shocks get substantially amplified in an environment of easy access to credit. However, when the …Read More

Rendahl, Pontus, “Fiscal Policy in an Unemployment Crisis”, The Review of Economic Studies, 22 February This article shows that equilibrium unemployment dynamics can significantly increase the efficacy of fiscal policy. In response to a shock that brings the economy into a liquidity trap, an expansion in government spending increases output and causes a fall in the unemployment rate. Since movements in unemployment are persistent, the effects of current spending prevail into the …Read More

Mourlon-Druol, Emmanuel, (2016), “Banking Union in Historical Perspective: The Initiative of the European Commission in the 1960s–1970s”, JCMS Vol. 54, Iss. 4, July This article shows that planning for the organization of EU banking regulation and supervision did not just appear on the agenda in recent years with discussions over the creation of the eurozone banking union. It unveils a hitherto neglected initiative of the European Commission in the 1960s and early 1970s. …Read More

Thimann, Christian, (2016), “Quantitative Easing: The Challenge for Households Long-term Savings and Financial Security”, CESifo Working Paper No. 5976,  June The extremely low long-term interest rates in capital markets, to a relevant extent induced by quantitative easing, imply significant challenges for retirement saving and the stability of households’ purchasing power over the long-term. The reason is that prices for the two most important long-term savings objectives – housing and healthcare – are …Read More

Schäfer, David, (2016), “A Banking Union of Ideas? The Impact of Ordoliberalism and the Vicious Circle on the EU Banking Union”, Journal of Common Market Studies, 5 January The establishment of the EU banking union reveals two major shortcomings of liberal intergovernmentalism. First, it fails to explain the preference formation of the most important actor – the German government. The banking sector was divided between public and private banks, and there is …Read More

Doyle, Nicola, Hermans, Lieven, Molitor, Philippe , Weistroffe, Christian, (2016), “Shadow banking in the euro area: risks and vulnerabilities in the investment fund sector”, ECB  Occasional Paper 174, June This paper first highlights the structural features of shadow banking in the euro area, focussing on investment funds. It then discusses the potential systemic risks that the recent expansion of the investment fund sector presents. While investment funds provide important intermediation services to the …Read More

Roth, F., Jonung, L., and Nowak-Lehmann D., F., (2016), “Crisis and Public Support for the Euro, 1990–2014”,  Journal of Common Market Studies, 54: 944–960, July This article analyses the evolution of public support for the single European currency, the euro, from 1990 to 2014 for a 12-country sample of the euro area (EA-12), focusing on the most recent period of the financial and sovereign debt crisis, starting in 2008. We …Read More

Nikola Bokan, Andrea Gerali, Sandra Gomes, Pascal Jacquinot, Massimiliano Pisani, (2016), “EAGLE-FLI: A macroeconomic model of banking and financial interdependence in the euro area”, ECB Working Paper 1923, June We incorporate financial linkages in EAGLE, a New Keynesian multi-country dynamic general equilibrium model of the euro area (EA) by including financial frictions and country-specific banking sectors. In this new version of the model, termed EAGLE-FLI (Euro Area and GLobal Economy …Read More

Kleis, Mischa, Moessinger, Marc-Daniel, (2016), “The Long-run Effect of Fiscal Consolidation on Economic Growth: Evidence from Quantitative Case Studies“, ZEW Discussion Paper No. 16-047, June We contribute to the literature on the long-run effect of fiscal consolidation on eco- nomic growth by applying a novel method for quantitative case studies. Relying on a qualitative (narrative) definition of fiscal consolidations based on an examination of historical policy documents and using the …Read More