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European Safe Bond: Handle With Care

Baglioni, Angelo, Hamaui, Rony, (2017), “European Safe Bond: Handle With Care”, Social Europe, 5 July In the Euro Area there is a scarcity of risk-free securities; these are issued today only by a few sovereigns with a very high rating, but not by any European institution given strong German opposition. This situation creates huge capital flows in stress periods (flight-to-quality) and it contributes to the diabolic loop between bank and sovereign …Read More

The rise of redistributive politics in the EU is setting limits on the completion of Economic and Monetary Union

Vilpišauskas, Ramūnas , (2017), “The rise of redistributive politics in the EU is setting limits on the completion of Economic and Monetary Union”, LSE EUROPP, 24 June One of the key areas of controversy in responses to the Eurozone crisis has been the notion of transferring financial resources from prosperous economies in the North to struggling economies in the South. Ramūnas Vilpišauskas argues that this issue has effectively put redistributive politics …Read More

The European banking union at three: A toddler with tantrums

Beck, Thorsten, (2017), “The European banking union at three: A toddler with tantrums”, Vox Eu, 3 July 2017 A little less than three years ago, the bank regulatory framework in the Eurozone seemed to have reached a decisive moment, with the completion of the Comprehensive Assessment and the establishment of the Single Supervisory Mechanism and Single Resolution Mechanism, and the implementation of the Bank Recovery and Resolution Directive (BRRD). Taxpayer-funded …Read More

Reflecting on how to run €MU more effectively

Begg, Iain, (2017), “Reflecting on how to run €MU more effectively”, LSE EUROPP, 29 June Earlier this year, the European Commission published a consultative White Paper setting out a number of scenarios on the Future of Europe and undertook to nourish the ensuing debates by releasing a series of Reflection Papers on key dimensions of the development of the Union. Among these is the recently-released one on the deepening of …Read More

Eurozone or EU budget? Confronting a complex political question

Wolff, Guntram B., (2017), “Eurozone or EU budget? Confronting a complex political question”, Bruegel, 29 June The European Commission has just published its reflection paper on the future of the EU budget. It touches on many topics, but at its heart the paper is agonising over one political question: Should there be a euro-area budget distinct from the overall EU budget? And if so, what kind of interplay will there …Read More

EU – Fateful Year 2017

Vorbach, Judith, (2017), “EU – Fateful Year 2017″, Social Europe, 29 Ιουνίου Economic policy has predominantly been run on neoliberal lines, notably since the 1970s. This trend has manifested itself in the liberalization of markets, cuts in public investment, de-regulation, privatization and marginalization of trade unions. The credo runs: The less government interferes in the market and the more it improves the framework conditions for companies (aka supply side), the …Read More

How To Get Rid Of Germany’s Excessive Current Account Surplus

Horn, Gustav, (2017), “How To Get Rid Of Germany’s Excessive Current Account Surplus”, Social Europe, 26 June The demand is frequently made that wages in Germany should grow more strongly than up till now. The hope is that this would raise the price of exports and, thereby, foreign demand for German goods would drop. This alone would reduce the surplus in the current account. There would be an even stronger effect …Read More

Unemployment insurance and reservation wages

Le Barbanchon, Thomas, Rathelot, Roland, Roulet, Alexandra, (2017), “Unemployment insurance and reservation wages”, Vox Eu, 27 June Pinpointing the right level of generosity of an unemployment insurance system is a delicate exercise. The main objective of the unemployment system is to provide insurance for workers who lose their jobs. The system should be generous enough to smooth income shocks and allow workers to look for a job when economic conditions …Read More

Understanding The Productivity Puzzle

Davies, Howard, (2017), “Understanding The Productivity Puzzle”, Social Europe, 26 June According to the UK’s Office for National Statistics, output per hour in France was 14% lower in 2015 than it would have been had the previously normal trend growth rate been matched. Output was 9% lower in the United States and 8% lower in Germany, which has remained the top performer among developed economies, albeit only in relative terms. …Read More

Europe’s Banking Union Is Dying in Italy

Giugliano, Ferdinando, (2017), “Europe’s Banking Union Is Dying in Italy”, Bloomberg View, 23 June The Italian government looks set to put Veneto Banca and Banca Popolare di Vicenza, two troubled regional lenders, into liquidation, selling off the good assets to a rival bank for a symbolic price. The toxic assets would be transferred to a bad bank, mostly funded by the government. Shareholders and junior bond-holders would contribute to the …Read More