Rannenberg, Ansgar, Schoder, Christian, Strasky, Jan, (2015), “The macroeconomic effects of the Eurozone’s fiscal consolidation”, Voxeu, 11 November. From 2011 to 2013, fiscal policy in the Eurozone turned progressively more restrictive. This column argues that output cost of fiscal consolidation strongly depends on presence and strength of credit constraints. With credit constraints both in the household and the firm sector, fiscal consolidation would be largely responsible for the weak growth performance during 2011-2013. …Read More

Orphanides, Athanasios, (2015), “Short-sighted monetary policy and fear of liftoff”, Voxeu, 11 November. There is generally consensus among macroeconomists that monetary policy works best when it is systematic. Following the financial crisis, the Federal Reserve Bank of the US shifted from long-term, systematic policy to short-term goals targeting unemployment. This column argues that, while these were appropriate in the aftermath of the downturn, such policy accommodations have been pursued for too long …Read More

Sy, Mouhamadou, (2015), “External imbalances within the Eurozone: The Dutch disease explanation”, Voxeu, 9 November One of the most prominent features of the Eurozone Crisis has been the large current account deficit accumulated by countries at the periphery relative to those at the core (Baldwin and Giavazzi 2015). These imbalances (see Figure 1) are commonly attributed to differences in competitiveness as manifested in persistent differences in the unit labour costs, or …Read More