Papantoniou, Y., (2013), “The Re-Division of Europe”, Project Syndicate, 06 December. As the eurozone debt crisis has steadily widened the divide between Europe’s stronger northern economies and the weaker, more debt-laden economies in the south (with France a kind of no man’s land economy in between), one question is on everyone’s mind: Can Europe’s monetary union – indeed, the European Union itself – survive? While the eurozone’s northern members enjoy …Read More
Unemployment Likely to Continue to Decline
Barnichon, R., (2013), “Unemployment Likely to Continue to Decline; Don’t Read Much into October Employment Report”, Brookings, Brookings on Job Numbers Blog, 05 December. This post discusses my monthly update of the Barnichon-Nekarda model. For an introduction to the basic concepts used in this post, read my introductory post (Full details are available here.) In September, the unemployment rate increased to 7.3%, 0.2 percentage points higher than the model had …Read More
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Greece’s Reforms Have Only Cracked the Surface
Hatzis, A., (2013), “Greece’s Reforms Have Only Cracked the Surface”, The Wall Street Journal, 05 December. Last week Ángel Gurría, the secretary-general of the Organization for Economic Co-operation and Development, visited Athens to present the OECD’s latest economic survey of Greece. Since 2010, the report said, Greece “has made impressive headway in cutting its fiscal and external imbalances and implementing structural reforms to raise labor market flexibility and improve labor …Read More
An Agenda to Save the Euro
Stiglitz, J., (2013), “An Agenda to Save the Euro”, Project Syndicate, 04 December. It has been three years since the outbreak of the euro crisis, and only an inveterate optimist would say that the worst is definitely over. Some, noting that the eurozone’s double-dip recession has ended, conclude that the austerity medicine has worked. But try telling that to those in countries that are still in depression, with per capita …Read More
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The Faux European Recovery and Youth Unemployment
Weeks, J., (2013), “The Faux European Recovery and Youth Unemployment”, Social Europe Journal, 03 December. Suddenly the media is a buzz with the prospect of a recovery in the euro zone. After four grim years of contracting GDP, unemployment and falling real wages, we read that country after country has turned the corner. Austerity worked and now we can reap the benefits. Before we become too overjoyed, it is worth …Read More
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The New European Framework for Managing Bank Crises
Micossi, S., Bruzzone, G. and Carmassi, J., (2013), “The New European Framework for Managing Bank Crises”, The Centre for European Policy Studies, CEPS Policy Brief No.304, 21 November. This Policy Brief describes and discusses the proposals for a European Single Resolution Mechanism (SRM) for banks and for a Directive on Bank Recovery and Resolution (BRR). The authors find that the proposals are generally well designed and present a consistent approach, …Read More
Europe’s real inflation problem
Pisani-Ferry, J., (2013), “Europe’s real inflation problem”, Project Syndicate, 30 November. “Having said that deflation in the United States is highly unlikely,” outgoing Federal Reserve Chairman Ben Bernanke famously remarked in 2002, “I would be imprudent to rule out the possibility altogether.” At that time, annual inflation in the US exceeded 2%, and the risk of it becoming negative was indeed remote; but Bernanke nonetheless felt it necessary to map …Read More
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Paths to full employment
Bernstein, J., (2013), “Paths to full employment”, The New York Times, Economix Blog, 02 December. Economists like me, who stress the importance of full employment, have a bad habit. We go on and on about the problem of slack labor markets – their negative impact on the living standards of middle- and lower-income families, their persistence in recent decades – and then we stop without saying what might be done …Read More
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Why Germany’s trade surplus is bad for the eurozone
Springford, J. and Tilford, S., (2013), “Why Germany’s trade surplus is bad for the eurozone”, Centre for European Reform Bulletin, Issue 93, December 2013/ January 2014. In late October, the US singled out Germany as a threat to the global economy. The Treasury issued a report saying that Germany’s current account surplus – now around 7 per cent of GDP – imposes “a deflationary bias for the eurozone as well …Read More
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Europe rightly pursues the road to a single resolution mechanism
Wolf, G., (2013), “Europe rightly pursues the road to a single resolution mechanism”, Bruegel, 27 November. European leaders continue to negotiate the most desirable structure of a single resolution mechanism. Making significant progress on that front is of central importance, as we have argued in a recent piece to the informal ECOFIN. The single most important reason why it is important relates to the reshaping of Europe’s financial system. Since …Read More
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