EU policies

Marco Buti, Servaas Deroose, José Leandro, Gabriele Giudice, 13 July 2017

Despite much being done to strengthen the Economic and Monetary Union, it remains incomplete and this is one of the main reasons for the Eurozone's lacklustre economic performance in the recent years. While there are still diverging views on how to "cross the river", there is also a political and economic window of opportunity to complete the EMU architecture. This column discusses the ideas presented in a new European Commission Reflection Paper aimed at relaunching the debate on how to move forward, with a focus on bridging the differences between the member states that stress responsibility and risk reduction and those calling for solidarity and risk sharing.

Giorgio Barba Navaretti, Giacomo Calzolari, Alberto Pozzolo, 06 July 2017

There is a growing awareness that non-performing loans generate risks of financial instability and constrain lending growth, and that coordinated action to solve the problem in Europe is both necessary and achievable. This column discusses proposals for state-supported vehicles, such as asset management companies, put forward by the main international organisations and prominent scholars to deal with the large backlog of non-performing loans. Part of this backlog will be resolved through market-based solutions, but due to market failures and capital shortages of critical banks, state-supported schemes are also deemed necessary.

Jean-Charles Bricongne, Alessandro Turrini, 22 June 2017

Since 2011, EU macroeconomic surveillance has aimed at preventing or correcting the type of imbalances that were responsible for the Global Crisis. Surveillance under the Macroeconomic Imbalance Procedure implies regular reports and policy recommendations monitored by the Commission, and the possible activation of economic sanctions. This column shows that, despite the procedure not having been used to its full extent so far and the sanctions stage not having been reached yet, the surveillance and recommendations have had an impact on policies in the first years of implementation. 

Christos Genakos, Tommaso Valletti, Frank Verboven, 16 June 2017

Europe is experiencing a wave of mergers in the telecommunications industry. This column argues that an increase in market concentration in the mobile industry generates an important potential trade-off: while consolidation increases prices, investment per operator also goes up. Competition and regulatory authorities should be open to the potential trade-off between market power effects and efficiency gains from agreements between firms.

Agnès Bénassy-Quéré, Francesco Giavazzi, 31 May 2017

The euro’s economic architecture is still incomplete, meaning that any number of large shocks could reignite the crisis in the Eurozone. This column introduces a new VoxEU eBook which summarises the main issues that need to be addressed to make the euro work and identifies, for each issue, the degree of consensus among experts.

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