Schoenmaker, Dirk, (2017), “What happened to global banking after the crisis?”, Bruegel, 14 March The global financial crisis allegedly led to the end of global banking. However, we find that reports of the demise of global banking are premature. Among the global systemically important banks, we find that there has been a shift of business from the global European banks to the more domestic Asian banks, which are gradually increasing their …Read More
Reichlin, Lucrezia, (2017), “Democracy Over Sovereignty in Europe”, Project Syndicate, 14 March The future of the European Union may not officially be on the ballot in the upcoming elections in the Netherlands, France, Germany, and Italy, but the results will go a long way towards determining Europe’s fate. Anti-EU sentiment is more widespread than ever, as demonstrated by the feverish campaigns of right-wing populist insurgents like Geert Wilders in the Netherlands and …Read More
Eichengreen, Barry J., Bayoumi, Tamim, (2017), “Aftershocks of Monetary Unification : Hysteresis with a Financial Twist”, IMF, 13 March Once upon a time, in the 1990s, it was widely agreed that neither Europe nor the United States was an optimum currency area, although moderating this concern was the finding that it was possible to distinguish a regional core and periphery (Bayoumi and Eichengreen, 1993). Revisiting these issues, we find that …Read More
Banerji, Angana, Dabla-Norris, Era, Duval, Romain, Furceri, Davide, (2017), “The Case for Fiscal Policy to Support Structural Reforms”,IMF, 13 March Many advanced countries need structural reforms to make their economies more productive and raise long-term living standards. Our new research shows that provided countries can afford it, fiscal policy, through spending or tax incentives, can help governments overcome some obstacles to the reforms, particularly in the early stages. Structural reforms …Read More
Rozenov, Rossen, (2017), “Public Debt Sustainability Under Uncertainty : An Invariant Set Approach”, IMF Working Paper, 13 March The question of what level of public debt a country can afford is central to fiscal policy. Vast literature is devoted to debt sustainability and an array of tools has been developed to guide assessment. A comprehensive review of previous work on the subject is beyond the scope of this paper and …Read More
Ashworth, Marcus, (2017), “Europe’s Bailout Misery”, Bloomberg Gadfly, 13 March Europe’s tale of two rescue funds is morphing into a worrying saga. The outlook for the region’s original crisis bailout vehicle, the European Financial Stability Fund, to raise sufficient long-term funds to do its job is getting trickier. Despite last week being a pretty decent one for bond issuance, the EFSF stayed on the sidelines. Meanwhile, its more-popular sister fund, the European Stability …Read More
Barber, Tony, (2017), “Europe starts to think the unthinkable: breaking up”, Financial Times, 2 March As an illustration of the EU’s doubts about its destiny, Jean-Claude Juncker’s white paper on Europe’s future fitted the bill nicely. Unveiled on Wednesday, the European Commission president’s document contained no fewer than five scenarios for the EU’s evolution up to 2025: “carrying on”, “nothing but the single market”, “those who want more do more”, “doing less …Read More
Bershidsky, Leonid, (2017), “A Multispeed Europe Will Be Hard to Pull Off”, BloombergView, 10 March The European Council, which includes leaders of EU member states, normally issues a consensus document at the end of each meeting. On Thursday, it failed to do so because one member — Polish Prime Minister Beata Szydlo — refused to approve it. The spat tells us something about the rocky future of a multispeed Europe. Relevant …Read More
European Central Bank/ECB staff macroeconomic projections for the euro area, March 2017 The economic recovery in the euro area is projected to firm further, at a pace slightly above previous expectations. The expected global recovery and resilient domestic demand, supported by the very accommodative monetary policy stance, past progress made in deleveraging across sectors and a continued improvement in the labour market are projected to sustain the recovery over the projection horizon. The recent oil …Read More
Tsiftsoglou, Anna, (2017), “Beyond Crisis: Constitutional Change in Greece after the Memoranda”, LSE Hellenic Observatory, 9 March Can financial crises bring constitutional change? Has Greece become a prominent such example? Already 7 years into recession, crisis-hit Greece is experiencing a tremendous institutional change. This change, which takes place informally rather than formally, is affecting state institutions- primarily its parliament, the executive and courts. Everyday practice, political or otherwise, changes the …Read More
