The Experts below are selected from a list of 26367 Experts worldwide ranked by ideXlab platform
Paul De Grauwe - One of the best experts on this subject based on the ideXlab platform.
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Time to change budgetary priorities in the Eurozone
LSE Research Online Documents on Economics, 2019Co-Authors: Paul De GrauweAbstract:With the spectre of a recession looming in the Eurozone (and elsewhere), the policy question arises as to how much leeway do the fiscal authorities in the Eurozone have to follow counter-cyclical fiscal policies aimed at providing some stimulus to the economy.
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Governing a sustainable Eurozone
2017Co-Authors: Paul De GrauweAbstract:The design failures of the Eurozone have been recognized quite late and have led the Eurozone policymakers to apply wrong macro-economic policies since the eruption of the sovereign debt crisis. This has led to a dismal macroeconomic performance of the Eurozone countries as compared to the EU-countries that decided not to be part of the monetary union. We provide empirical evidence that suggests that the biggest shocks in the Eurozone were the result of business cycle movements. These were relatively well synchronised, except for their amplitude. We argue that efforts to stabilise the business cycles should be strengthened relative to the efforts that have been made to impose structural reforms, and consider the implications for the governance of the Eurozone.
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The legacy of the Eurozone crisis and how to overcome it
LSE Research Online Documents on Economics, 2016Co-Authors: Paul De GrauweAbstract:I argue first that the Eurozone crisis has left a legacy of unsustainable government debt levels. These will continue to exert a deflationary dynamics in the Eurozone. Second, I argue that the institutional innovations since the start of the debt crisis fall short of what is needed to solve the design failures of the Eurozone. In addition, they are not sustainable, mainly because they have led to a situation where bureaucratic institutions have been vested with more responsibilities without a concomitant increase in the democratic legitimacy of these institutions.
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has the Eurozone become less fragile some empirical tests
Journal of Policy Modeling, 2015Co-Authors: Paul De GrauweAbstract:In this paper we provide empirical evidence documenting the nature of the Eurozone’s fragility. We find that during periods of turmoil, financial markets have tended to impose strong programs of austerity on member countries of the Eurozone. This confirms the evidence we found in a previous paper (De Grauwe and Ji(2013)). In addition we find that the panic-induced austerity, as it occurs mainly during periods of recession, has the effect of reducing the power of the automatic stabilizers in the government budgets, thereby making the economic downturns more intense. We find evidence that this feature has been present in the Eurozone. Our policy conclusion is that the institutional changes that have been introduced in the Eurozone since the start of the sovereign debt crisis are insufficient to safeguard the Eurozone from future crises.
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The Future of the Eurozone
The Manchester School, 2014Co-Authors: Paul De GrauweAbstract:We argue first that the Eurozone crisis has left a legacy of unsustainable government debt levels. These will continue to exert a deflationary dynamics in the Eurozone except if creditor nations are willing to contemplate a debt restructuring. Second, we argue that the institutional innovations since the start of the debt crisis fall short of what is needed to solve the design failures of the Eurozone. In addition, they are not sustainable, mainly because they have led to a situation where bureaucratic institutions have been vested with more responsibilities without a concomitant increase in the democratic legitimacy of these institutions. We conclude that the Euro crisis is not over.
Anthony O'driscoll - One of the best experts on this subject based on the ideXlab platform.
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Firm-level exchange exposure in the Eurozone
2010Co-Authors: Elaine Robyn Hutson, Anthony O'driscollAbstract:Using a sample of 1,154 European firms from 11 countries, we show that firm-level exchange exposure for Eurozone and non-Eurozone European firms has increased since the advent of the euro, but this rise was smaller for Eurozone than non-Eurozone firms. The increase in firmspecific risk is offset by a substantial reduction in market-level exchange exposure in most Eurozone countries, so the advent of the Eurozone appears to have been associated with a shift in exchange risk from systematic to firm-specific. We also find that Eurozone firms’ exchange exposure is greater than that of non-Eurozone European firms, and univariate testing confirms the significance of this difference. In a multivariate setting, however, after controlling for countryspecific and firm-specific characteristics that potentially influence the extent of exposure – economic openness, governance factors, firm size, industry and several financial ratios – this difference is no longer apparent.
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Firm-level exchange rate exposure in the Eurozone
International Business Review, 2010Co-Authors: Elaine Robyn Hutson, Anthony O'driscollAbstract:Using a sample of 1154 European firms from 11 countries, we show that firm-level exchange exposure for Eurozone and non-Eurozone European firms has increased since the introduction of the euro, but this rise was smaller for Eurozone than non-Eurozone firms. The increase in firm-specific exposure was offset by a substantial reduction in market-level exchange exposure in most Eurozone countries, so the advent of the euro appears to have been associated with a shift in exchange risk from systematic to firm-specific. We also find that post-euro, Eurozone firms' exchange exposure is significantly greater than that of non-Eurozone European firms. This difference, however, disappears after controlling for several country-specific and firm-specific characteristics that potentially influence firms' exchange exposure.
Elaine Robyn Hutson - One of the best experts on this subject based on the ideXlab platform.
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Firm-level exchange exposure in the Eurozone
2010Co-Authors: Elaine Robyn Hutson, Anthony O'driscollAbstract:Using a sample of 1,154 European firms from 11 countries, we show that firm-level exchange exposure for Eurozone and non-Eurozone European firms has increased since the advent of the euro, but this rise was smaller for Eurozone than non-Eurozone firms. The increase in firmspecific risk is offset by a substantial reduction in market-level exchange exposure in most Eurozone countries, so the advent of the Eurozone appears to have been associated with a shift in exchange risk from systematic to firm-specific. We also find that Eurozone firms’ exchange exposure is greater than that of non-Eurozone European firms, and univariate testing confirms the significance of this difference. In a multivariate setting, however, after controlling for countryspecific and firm-specific characteristics that potentially influence the extent of exposure – economic openness, governance factors, firm size, industry and several financial ratios – this difference is no longer apparent.
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Firm-level exchange rate exposure in the Eurozone
International Business Review, 2010Co-Authors: Elaine Robyn Hutson, Anthony O'driscollAbstract:Using a sample of 1154 European firms from 11 countries, we show that firm-level exchange exposure for Eurozone and non-Eurozone European firms has increased since the introduction of the euro, but this rise was smaller for Eurozone than non-Eurozone firms. The increase in firm-specific exposure was offset by a substantial reduction in market-level exchange exposure in most Eurozone countries, so the advent of the euro appears to have been associated with a shift in exchange risk from systematic to firm-specific. We also find that post-euro, Eurozone firms' exchange exposure is significantly greater than that of non-Eurozone European firms. This difference, however, disappears after controlling for several country-specific and firm-specific characteristics that potentially influence firms' exchange exposure.
Gregory Guilmin - One of the best experts on this subject based on the ideXlab platform.
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economic policy uncertainty and risk spillovers in the Eurozone
Journal of International Money and Finance, 2016Co-Authors: Oscar Bernal, Jeanyves Gnabo, Gregory GuilminAbstract:This paper focuses on the impact of economic policy uncertainty on risk spillovers within the Eurozone and contributes to these two growing literatures. To this end, we adapt the two-step procedure developed by Adrian and Brunnermeier (forthcoming) in the framework of financial systemic risk to the sovereign bond market. Accordingly, we attempt (i) to measure the extent to which distress affecting one given country's sovereign spreads can affect the Eurozone's bond market as a whole and then (ii) to identify the determinants of risk spillovers by estimating a panel data model with macroeconomic state variables and economic policy uncertainty (EPU) indices introduced by Baker et al. (2013) as regressors. EPU indices considered concern the four largest Eurozone countries, i.e. Germany, France, Italy and Spain, as well as the United States. The model is estimated with quarterly data for ten countries representing the bulk of debt issuances within the Eurozone over a period ranging from Q4/2008 to Q2/2013, which is characterized by historically high dispersion of sovereign bond spreads either across time or across countries. Our results support the idea that economic policy uncertainty in the core economies of the Eurozone, i.e. Germany and France, as well as in the largest periphery countries, i.e. Italy and Spain, can create an environment likely to exacerbate the transmission of risk arising from abnormal developments of individual countries' sovereign spreads to the Eurozone bond market as a whole. In this respect, our results plead for larger effort of Eurozone “leaders” to reduce the uncertainty surrounding their economic policy in periods of crisis not only to avoid adverse effects on their own economies but also to reduce the risk of a destabilization of the Eurozone sovereign bond market as a whole.
Sharmila King - One of the best experts on this subject based on the ideXlab platform.
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do national economic shocks influence european central bank interest rate decisions the impact of the financial and sovereign debt crises
Journal of Common Market Studies, 2013Co-Authors: Florence Bouvet, Sharmila KingAbstract:This article examines the relevance of national economic conditions for European Central Bank (ECB) interest rate setting and whether the financial and sovereign debt crises have made national divergences more relevant. Officially, the ECB sets policy for the Eurozone and considers only Eurozone data. However, economic shocks in one or more countries may warrant a deviation from this rule. Using real‐time, forecast data, the authors estimate a modified Taylor rule incorporating two macroeconomic ‘national influence’ measures: first the difference between the median and the Eurozone measures of inflation and real gross domestic product (GDP) growth, and then deviations of the measures of inflation and real GDP growth for the ‘core’ and ‘periphery’ countries from Eurozone averages. Using rolling‐window analysis to test the stability of parameter estimates, evidence is found that divergences in national data – notably developments in the periphery – from Eurozone averages play an increasingly important role during the financial and sovereign debt crises.
