Fuertes Α.-Μ., Kalotychou , Ε. & Saka, Ο. (2014) “ECB Policy and Eurozone Fragility: Was De Grauwe Right?“, Economic Policy, CEPS Working Documents, 20 Ιουνίου. The authors test Paul De Grauwe’s eurozone fragility hypothesis using a time window around the announcement of the Outright Monetary Transactions (OMT) programme. The findings reveal significant contagion from Spain to other eurozone countries, but solely during the pre-announcement period. The authors conclude that …Read More
Inequality in the long run
Piketty, T. & Saez, E. (2014) “Inequality in the long run“, Science, 23 May, Vol. 344 no. 6186 pp. 838-843. This Review presents basic facts regarding the long-run evolution of income and wealth inequality in Europe and the United States. Income and wealth inequality was very high a century ago, particularly in Europe, but dropped dramatically in the first half of the 20th century. Income inequality has surged back …Read More
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The Fiscal Crisis as a Crisis in Trust
Haliassos, M. (2014) “The Fiscal Crisis as a Crisis in Trust“, Goethe University Frankfurt, Center for Financial Studies and SAFE, Frankfurt: 12 May. The sources of the fiscal crisis have been different, but the prescribed measures amount to two: achieve budget surpluses to start reducing the size of the debt, and undertake the necessary reforms to create or boost the productive base, so as to make repayment of the …Read More
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EU: Reframing Can Go Hand in Hand with Reform
Morris , M. (2014) “EU: Reframing Can Go Hand in Hand with Reform“, Eurocrisis in the Press, LSE EUROPP, 20 June. Last year my colleague Giulio Carini and I wrote an article about ‘reframing’ the EU. We thought that the current frames supporters of the EU were using in the debate were obstructive and we wanted to suggest some alternatives. We were particularly motivated to do so because we …Read More
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Little Green Data Book 2014
The World Bank (2014) “Little Green Data Book 2014“, International Bank for Reconstruction and Development, June. The Little Green Data Book 2014 is based on World Development Indicators 2014 and its online database. Defining, gathering, and disseminating international statistics is a collective effort of many people and organizations. The indicators presented in World Development Indicators are the fruit of decades of work at many levels, from the field workers …Read More
It’s Time To Stand Up To Troika Austerity (Part II)
Fazi, Τ. (2014) “It’s Time To Stand Up To Troika Austerity (Part II)“, Social Europe Journal, 19 June. In the first part of this article I looked at the mounting evidence against austerity by organisations as varied as Caritas, the ILO, the Council of Europe and the IMF. So why is the European establishment pushing for more of the same? Social and economic misery and despair, growing inequality, dwindling public services, …Read More
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Does Culture Matter for Economic Growth?
Vollrath, D. (2014) “Does Culture Matter for Economic Growth?“, The Growth Economics Blog, 18 June. There’s been an increasing number of papers concerned with culture and its relationship to economic growth. I happened to just see this working paper by Di Tella and MacCulloch (2014), but the idea of culture being an important determinant of economic development levels has been hanging out there in the literature for a long time. …Read More
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Does Politics Dominate Economics In Eurozone Crisis Management?
Wren-Lewis, S. (2014) “Does Politics Dominate Economics In Eurozone Crisis Management?“, Social Europe Journal, 18 June. Athanasios Orphanides, leading academic macroeconomist and from 2007-12 Governor of the Central Bank of Cyprus, does not hold back in a recent paper. Here is just one quote: “During the crisis, key decision makers exhibited neither political leadership nor political courage. Rather than work towards containing total losses, politics led governments to focus on …Read More
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Despite lower yields, euro-periphery is not yet out of the woods
Darvas, Z. & Pia Hüttl, P. (2014) “Despite lower yields, euro-periphery is not yet out of the woods – while the public debt ratio is expected to fall, the debt trajectory remains highly vulnerable to negative growth, primary balance and interest rate shocks“, Working Paper – European Macroeconomics, Bruegel Association, 18 Ιουνίου. Following Ireland, Portugal has also exited its financial assistance programme in a clean way, namely without any …Read More
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Why DSGEs crash during crises
Hendry, F. D., Mizon, E. G. (2014) “Why DSGEs crash during crises“, VoxEU Organisation, 18 June. Many central banks rely on dynamic stochastic general equilibrium models – known as DSGEs to cognoscenti. This column – which is more technical than most Vox columns – argues that the models’ mathematical basis fails when crises shift the underlying distributions of shocks. Specifically, the linchpin ‘law of iterated expectations’ fails, so economic …Read More
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