Against the background of the recent housing boom and bust in countries such as Spain and Ireland, we investigate in this paper the macroeconomic consequences of cross-border banking in monetary unions such as the euro area. For this purpose, we incorporate in an otherwise standard two-region...

The ECB's one size monetary policy is unlikely to fit all euro area members at all times, which raises the question of how much monetary policy stress this causes at the national level. I measure monetary policy stress as the difference between actual ECB interest rates and Taylor-rule implied...

Between 1999 and the onset of the economic crisis in 2008 real exchange rates in Greece, Ireland, Italy, Portugal and Spain appreciated relative to the rest of the euro area. This divergence in competitiveness was reflected in the emergence of current account imbalances. Given that exchange rate...

No country in Europe is safe from a recession. A stabilization fund which member states pay into while the economy is strong and from which they receive grants during downturns can improve welfare in individual euro area countries. The fund should be structured in such a way that permanent...

Twenty years after the introduction of the euro, this Weekly Report uses an empirical analysis to assess the performance of monetary policy in the EMU founding states. It is often claimed that the monetary policy of the European Central Bank (ECB) cannot outperform its national predecessors, as...

Reorganizing European fiscal policy is a main topic in current reform considerations. In particular, the creation of a European stabilization mechanism is being discussed. This study examines the macroeconomic effects of a stabilization fund, the economic consequences of which are analyzed in an...

The Maastricht Treaty has augmented the preconditions that have to be fulfilled by ED applicants before a full membership can be achieved. Candidates have to prove that a participation in the European Monetary Union is a realistic possibility at least in the medium term. This paper explores the...

Durch den Maastrichter Vertrag soll Europa auf den Weg zu einer solidarischen und subsidiären Währungsunion gebracht werden. Nach einer Übersetzung dieser Begriffe in ökonomische Termini werden die Konsequenzen für die Fortentwicklung der EG-Finanzen untersucht. Es zeigt sich, daß das...