Schoenmaker, Dirk, (2016), “European insurance union and how to get there”, Bruegel, 13 December What are the arguments for and against centralisation of insurance supervision? What would be the scope of a possible insurance union, and what would the legal basis be? How rapid should the move to insurance union be? This Policy Brief sets out to answer these questions. Relevant Posts Guntram B. Wolff, (2016), “The European Deposit Insurance …Read More

Danielsson, Jon, Macrae, Robert, Tsomocos, Dimitri, Zigrand, Jean-Pierre, (2016), “Why macropru can end up being procyclical”, VoxEu, 15 December Discretionary macroprudential policies aim to be countercyclical by adjusting risk-taking across the financial cycle. This column argues that the opposite effect may happen in certain cases. Depending on how regulators measure risk and how they react, the eventual outcome may well be procyclical, with serious unintended consequences. Relevant Posts Merler, Silvia, (2016), …Read More

Darvas, Zsolt, (2016), “Explaining inequality”, Bruegel, 13 December Is technological progress behind growing income inequality? Zsolt Darvas argues increased automation is only part of the explanation. There is a growing awareness that income inequality has increased in a number of developed countries. The lucky ones, with high levels of accumulated wealth, assets and top incomes, earn more and more, while those who are at the bottom of the income distribution …Read More

Andor, László, Pasimeni, Paolo, (2016), “An unemployment benefit scheme for the Eurozone”, VoxEu, 13 December Since its inception, the Eurozone has had lower growth and higher unemployment rates than other regions, which suggests the need for new fiscal instruments. This column argues for a stabilisation instrument based on unemployment as the driving indicator. This unemployment benefit scheme coud take the form of a basic common European scheme, or a reinsurance fund supporting …Read More

Merler, Silvia, (2016), “The political economy of macroprudential policy”, Bruegel, 12 December What’s at stake: the emergence of renewed interest in macroprudential policy has characterised the aftermath of the great recession. There is not yet full agreement on what the tasks of macroprudential policy is or how it should be carried out, but there is a clear understanding that there is an important political economy dimension to it. We review …Read More

Gamberoni, Elisa, Giordano, Claire, Lopez-Garcia, Paloma, (2016), “Misallocating capital and labour across firms: Trends and determinants in selected Eurozone economies”, VoxEu, 13 December An efficient allocation of inputs across firms is a necessary condition to boost TFP growth. This column presents evidence that in large Eurozone economies, capital misallocation trended upwards in the period 2002-2012 while labour misallocation dynamics were flatter. Uncertainty and credit market frictions were strongly associated with the …Read More

Demertzis, Maria, B.Wolff, Guntram, (2016), “Eurozone QE and bank profitability: Why it is too early to taper”, Bruegel, 8 December In the eyes of the critics, the quantitative easing programs have been of little help to growth and inflation and have instead been an attack on savers, undermining the profitability of banks and insurances. Do these arguments stand scrutiny? Relevant Posts Hüttl, Pia, Merler, Silvia, (2016), “An update: Sovereign bond holdings …Read More

Dabrowski, Marek, (2016), “Challenges to debt sustainability in advanced economies”, Bruegel, 8 December The gross general government debt-to-GDP ratios in many advanced economies have reached the highest levels in peacetime history and continue to grow, putting into question sovereign solvency in these economies. Relevant Posts Dabrowski, Marek, (2016), “Are advanced economies at risk of falling into debt traps?”, Bruegel, 10 November Marsh, Chris, Nagly, Dominik, Pagoulatos, George, Papaioannou, Elias, (2016), …Read More

Alcidi, Cinzia, Barslund, Mikkel, Busse, Matthias, Nicoli, Francesco, (2016), “Will a European unemployment benefits scheme affect labour mobility?”, CEPS, 6 December Labour mobility in the EU is comparatively low, despite major efforts from the European Institutions to support cross-border mobility. This study evaluates the potential implications of a European Unemployment Benefits Scheme (EUBS) for labour mobility in the EU. We find that the introduction of an EUBS, irrespective of whether it …Read More

Campos, Nauro, El Aynaoui, Karim, Loungani, Prakash, (2016), “European unemployment and labour market reforms: A two-handed approach”, VoxEu, 5 December Thirty years ago, a distinguished group of economists advocated a ‘two-handed’ approach to unemployment that targeted supply as much as demand. This column examines recent work on the effectiveness of cyclical and structural policies – the two ‘hands’ – targeting unemployment in Europe. It further considers the pressures from greater integration …Read More