This report studies two areas of Core State Powers (CSP), i.e., Defence and Monetary Policy. The two cases have the aim to reconstruct how Differentiated Integration (DI) has developed over time in these two specific domains. While the aim is the same for both cases, the way the cases are...

We analyze causes and consequences of a monetary unification among countries with different institutional quality. Countries with stronger institutions choose a more productive policy, resulting in a stronger currency and lower taxes. Governments under weaker institutions prefer more spending...

This study analyzes the connectedness of income inequality, governance, and key macroeconomic factors in the EMU and WB. Using data from 2006 to 2019, we measure spillover conectedness on the economies due to shocks to (a) inequality, (b) governance, and (c) key macroeconomic factors. Contrary...

The suspension of the fiscal rules in Europe and the enactment of NGEU provide an opportunity to rethink the inherited budget orthodoxy. The issue at stake is not only of political economy and institutional changes in the EU. It is also of economic analysis and theory. The coronavirus crisis...

This paper analyzes country bailouts in a monetary union within a framework where sovereign default and exit from the union are two separate decisions. The studied bailouts are meant to prevent an exit and, thus, do not exclude subsequent defaults. The model replicates the experience of Greece,...

The Latin Monetary Union (hereafter LMU) was established in 1865 between France, Italy, Belgium and Switzerland. The agreement provided for the adoption of a common monetary base consisting of specie, and the adoption of the free circulation of gold and silver coins among them, whatever the...

The growing asymmetry in the size of fiscal imbalances poses a serious challenge to the macroeconomic stability of the Euro Area (EA). We show that following a contractionary shock, the current monetary and fiscal framework weakens economic growth even in lowdebt countries because of the zero...