Barbiero, Fr., Darvas, Zs., “In sickness and in health: protecting and supporting public investment in Europe”, Bruegel Policy Contribution, Issue 2014/02. The long-term decline in gross public investment in European Union countries mirrors the trend in other advanced economies, but recent developments have been different: public investment has increased elsewhere, but in the EU it has declined and even collapsed in the most vulnerable countries, exaggerating the output fall. The …Read More

Valante, D., (2014), “Framing Banking Union in the Euro Area: Some empirical evidence”, CEPS Working Document, N. 389/February 2014. Evidence shows that financial integration in the euro area is retrenching at a quicker pace than outside the union. Home bias persists: Governments compete on funding costs by supporting ‘their’ banks with massive state aids, which distorts the playing field and feeds the risk-aversion loop. This situation intensifies friction in credit …Read More

Hardouvelis, Gikas (2014), “Overcoming the crisis in Cyprus”, Economy & Markets, Vol. IX, Issue 1. Following the March 2013 bail-in of large bank depositors and the subsequent crisis, Cyprus faces major challenges and risks during 2014 and 2015. The first challenge is to ensure financial stability and lift all capital control restrictions. Another challenge is to move fast with structural reforms, gain credibility in fiscal policy and ensure the recession ends …Read More