Paolo Manasse, 24 July 2010

Despite the lack of formal mechanisms for fiscal coordination across Europe, this column suggests that the planned exit strategy seems to support convergence among European countries aiming to cut deficits. Yet it argues that the budget cuts do not reflect the unemployment situation of member countries and appear inspired by Germany's fiscal orthodoxy.

Eduardo Levy Yeyati, Mario Blejer, 21 July 2010

Rumours of Eurozone break-up are mounting. This column argues that exiting a strong currency for a weak one poses almost unthinkable challenges, from the redenomination of contracts and the imposition of bank restrictions to the restructuring of external debt and limiting of capital mobility. Lessons from Argentina illustrate just how radical the changes would need to be.

Alessandro Turrini, Uwe Böwer, Julia Lendvai, 21 July 2010

In 2009 the Baltic countries were hit by record recessions. Growth rates fell to -14% in Estonia, -18% in Latvia, and -15% in Lithuania. This column argues that structural adjustment towards the tradable sector is needed not only for a durable adjustment of their external position, but also for sustained growth in the long run – and sooner, rather than later.

Hans-Werner Sinn, 15 July 2010

Some Americans are calling on Germany to pursue expansionary fiscal policy. This column says that the German government should ignore US criticism of its savings measures.

Giancarlo Corsetti, 07 July 2010

Are governments right to start cutting their deficits? This column presents good news and bad news. It supports a strongly precautionary approach to fiscal consolidation, but warns of the macroeconomic costs that come with each additional cut in the deficit. The financial crisis is not over yet.

Kris Mitchener, Marc Weidenmier, 30 June 2010

The Eurozone crisis has led some to seriously consider the prospect of a breakup of the euro. This column presents evidence from the classical gold standard era (1870-1913) suggesting that even then investors doubted the credibility of emerging market countries sticking to a hard currency peg – with higher premiums on sovereign debt as a result.

Michael Landesmann, Vladimir Gligorov, 26 June 2010

As the debate rages over the best path for fiscal policy, this column looks at the causes of the Eurozone crisis, especially in emerging Europe. It argues that despite the debate focusing on public debt, the key issue is the development of private debt. That suggests that the key policy remedy would be private debt consolidation supported by countercyclical fiscal policy.

Jacopo Carmassi, Stefano Micossi, 24 June 2010

As the recent austerity measures can testify, Europe’s leaders are acutely concerned about government debt. This column tracks policy announcements from the start of the Eurozone crisis in December 2009, arguing that governments may have contributed to turmoil with their public display of confusion – ultimately undermining credibility. But if Eurozone governments show unity of purpose, this credibility can be restored.

Richard Baldwin, Daniel Gros, Luc Laeven, 17 June 2010

The euro’s crisis is not over. Measures taken in May were critical but they were palliatives not a cure. The Eurozone rescue needs to be completed. This Vox eBook gathers the thinking of a dozen leading economists on what more needs to be done.

Richard Baldwin, Daniel Gros, 17 June 2010

The euro’s crisis is not over. Measures taken in May were critical but they were palliatives not a cure. The Eurozone rescue needs to be completed. This column introduces a new Vox eBook that gathers the thinking of a dozen leading economists on what more needs to be done.

David Vines, 15 June 2010

Unlike Southeast Asia, Greece cannot devalue its currency in a bid to kick start an export-led recovery. Instead this column argues that, while it will be politically difficult, Greece needs a combination of debt reschedulement and consolidated, coordinated wage cuts – and fast.

Philip Lane, 17 June 2010

The global crisis has developed into a fiscal crisis within the Eurozone. This essay argues that fiscal policy during normal times must be sufficiently sustainable and counter-cyclical to enable aggressive fiscal intervention in the event of a major negative shock. It says that the solution is to set up independent fiscal councils in Eurozone member countries.

Giancarlo Corsetti, 17 June 2010

The Eurozone crisis is forcing fiscal retrenchments across Europe. The challenge is to reassure financial markets about debt sustainability without resorting to budget cuts and tax hikes that kill the recovery. This essay argues that quick corrections may be important signals of the government’s determination on fiscal discipline, but they are not sufficient. True sustainability must be based on policies that have lasting effects; a gradual implementation of spending cuts is probably the best strategy.

Maurizio Bovi, 30 May 2010

Europe’s highly indebted countries – Portugal, Italy, Ireland, Greece, and Spain – also face the problem of tax evasion. This column analyses how governments can tackle their fiscal deficits while reducing the possibility of forcing activity underground. It suggests that fewer, better paid public workers could complement tax cuts in fighting tax evasion.

Alberto Alesina, Giampaolo Lecce, Dorian Carloni, 29 May 2010

The market turmoil in recent weeks pose a key question: can European governments credibly commit to cutting their deficits? This column presents evidence that fiscal adjustments do not increase the likelihood of electoral defeat for incumbent governments. Europe’s fiscal problems can be solved – it is now up to today’s leaders to step up.

Guido Tabellini, 26 May 2010

Improvisation in handling the crisis in Greece has given the impression that governments and European institutions are not capable of facing the toughest challenges. This column reminds us that in times like these, the credibility of institutions is essential and rests on consistency. The ECB decision to "sterilise" the purchase of bonds with inverse operations to drain liquidity puts this credibility at risk.

Peter Bofinger, Stefan Ried, 20 May 2010

Current developments in Greece have raised doubts over the efficacy of the European Stability and Growth Pact. This column proposes a new framework for fiscal policy consolidation in Europe to deal with the ongoing fiscal exit and its related phenomena of crisis. On centre stage should be a European Consolidation Pact.

Paul De Grauwe, 19 May 2010

A government debt crisis is ravaging the Eurozone. This column argues that its cause is misunderstood. The culprit is a profligate private banking sector that has put strain on otherwise manageable government finances. The increase in debt has reached crisis point because the Eurozone is a monetary union without being a political union – it has no fire brigade to put out the fire.

Marco Pagano, 15 May 2010

The Eurozone has been swept up in turmoil that has ranged from stock and bond markets to exchange rates, government spending, and tax rates. Marco Pagano, Professor at the University of Naples Federico II and CEPR Research Fellow, explains events, how they hang together, and what needs to be done. This challenge facing Europe could be a historical turning point.

Morgan Kelly, 17 May 2010

The Celtic Tiger faces severe challenges. This column argues that the Irish government’s commitment to absorb the losses of its banking system may well lead to a Greek-style debt ratio by 2012. It is a test-in-waiting for the EU, but one that could be solved by a debt for equity swap to cover the losses of Irish banks.

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