Caldera , Aida, De Serres, Alain, Yashiro, Naomitsu, (2016), “Structural reforms in difficult times: The priorities”, VoxEU, 4 September Structural reforms can have adverse effects in the short run if implemented under weak macroeconomic conditions. This column argues that prioritising reform measures that bring short-term benefits even in a bad conjuncture, and packaging them to benefit from reform complementarities across product and labour markets, remains the most promising growth strategy, especially in …Read More

Weeks, John, (2016), “Eurozone Stagnation: Wrong Diagnosis, Wrong Medicine, No Recovery”, Social Europe, 2 September If a doctor misdiagnoses a patient’s malady and prescribes an inappropriate medicine, we would not expect recovery to good health. Should the doctor persist in the faulty diagnosis and prescribe further doses of the wrong medicine, the wise patient seeks a second opinion. As evidenced by the experience of Greece last year, it is the …Read More

Bossone, Biagio, (2016), “The true costs of helicopter money”, VoxEU, 5 September Some economists see helicopter money as a free lunch, because it can prompt growth without requiring higher debt financing. This column argues that if there are costs associated with the permanent injection of cash into the economy, they would diminish its effectiveness. Relevant Posts Heise, Michael, (2016), “The Unavoidable Costs of Helicopter Money”, Project Syndicate, 2 September Muellbauer, John, (2016), “Helicopter …Read More

Lagarde, Christine, (2016), “We Need Forceful Policies to Avoid the Low-Growth Trap”, iMFdirect, 1 September Low growth, high inequality, and slow progress on structural reforms are among the key issues that G20 leaders will discuss at their meeting in Hangzhou, China, this weekend. This meeting comes at an important moment for the global economy. The political pendulum threatens to swing against economic openness, and without forceful policy actions, the world could …Read More

Heise, Michael, (2016), “The Unavoidable Costs of Helicopter Money”, Project Syndicate, 2 September The long-running debate about the advisability of so-called helicopter money has changed shape, as new ideas emerge about the form it could take – and questions arise about whether it is already being dropped on some economies. What hasn’t changed is that embracing helicopter money would be a very bad idea. According to the conventional view, helicopter money is …Read More

Gros, Daniel, (2016), “The silent death of eurozone governance”, CEPS, 19 August Sometimes the most important thing that happens is what doesn’t happen – or, to paraphrase Sherlock Holmes, it’s the dog that doesn’t bark in the night. The lack of response to the European Commission’s non-enforcement in Spain and Portugal of the terms of the Stability and Growth Pact (SGP) is one of those times. According to SGP rules, the Commission …Read More

Gonzalez-Eiras, Martin, Niepelt, Dirk, (2016), “Fiscal Federalism, Taxation and Grants”, CEPR, Αugust We propose a theory of tax centralization and inter governmental grants in politico-economic equilibrium. The cost of taxation differs across levels of government because voters internalize general equilibrium effects at the central but not at the local level. This renders the degree of tax centralization and the tax burden determinate even if none of the traditional, expenditure-related motives for …Read More

Constâncio, Vitor, Hartmann, Philipp, (2016), “Selected takeaways from the ECB’s Sintra Forum on “The Future of the International Monetary and Financial Architecture””, VoxEU, 1 September The ECB’s 2016 Sintra Forum on Central Banking focused on the international monetary and financial system. In this column, the organisers of the forum highlight some of the main points from the discussions, including concerns that the world economy may be suffering from a shortage of …Read More