Veron, N., (2014), “Tectonic shifts – banking union is a long-term process that will dramatically reshape Europe’s financial system”, Bruegel, 7 March. On June 29, 2012, the leaders of euro area countries set in motion what is now universally known as European banking union, or the transfer of banking policy from the national to the European level. The first step, the empowerment of the European Central Bank as the new …Read More

Ostry, J., Berg, A. Tsangarides, C., (2014), “Redistribution, inequality, and the sustainable growth: Reconsidering the evidence”,  Voxeu.org, 6 March. Inequality has the potential to undermine growth. However, greater redistribution requires higher tax rates, which reduce incentives to work and save. Moreover, the evidence that inequality is bad for growth might simply reflect the fact that more unequal societies choose to redistribute more, and those efforts are antithetical to growth. This …Read More

Moqhadam, R., Teja, R. and Berkmen P., (2014), “Euro Area – Deflation Versus Lowflation”, iMFdirect Blog, 4 March. Recent talk about deflation in the euro area has evoked two kinds of reactions. On one side are those who worry about the associated prospect of prolonged recession. On the other are those who see the risk as overblown. This blog and the video below sift through both sides of the debate to argue …Read More

Varoufakis, Y., (2014), “What you should know about Greece’s present state of affairs  an update”, yanisvaroufakis.eu, 4 March. “It takes a passionate disregard for the truth to suggest that Greece is recovering.” That was my verdict last December upon being asked to comment on Greece’s rumoured recovery. Almost three months later, it is time for an update. The gist of today’s update is depressingly simple: Still, no sign of Greek-covery whatsoever. Indeed, every …Read More

O’ Rourke, K., (2014), “Whither the Euro?”, IMF Publications, 28 February. The euro area economy is in a terrible mess. In December 2013 euro area GDP was still 3 percent lower than in the first quarter of 2008, in stark contrast with the United States, where GDP was 6 percent higher. GDP was 8 percent below its precrisis level in Ireland, 9 percent below in Italy, and 12 percent below …Read More

Pistor, K., (2014), “German Court decision: Legal authority and deep power implications”, VoxEU, 26 Φεβρουαρίου Who wields supreme power over the ECB? This column analyses the recent ruling by the German Constitutional Court that the ECB cannot act as lender of last resort. Although seemingly couched by the referral of this decision to the European Court of Justice, this is a bid for power and the return to the pre-crisis …Read More