This paper studies the effects of delegating control of sovereign debt issuance to an independent authority in a monetary union where public spending decisions are decentralized. The model assumes that no policy makers are capable of commitment to a rule. However, consistent with Rogoff (1985)...

In 2007, countries in the euro periphery were enjoying stable growth, low deficits and low spreads. Then the financial crisis erupted and pushed them into deep recession, raising their deficits and debt levels. By 2010, they were facing severe debt problems. Spreads increased and, surprisingly,...

Should rational agents take into consideration government policy announcements? A skilled agent (an econometrician) could set up a model to combine the following two pieces of information in order to anticipate the future course of fiscal policy in real-time: (i) the ex-ante path of policy as...

This paper shows that there exist fiscal strategies that deliver equilibrium uniqueness in a monetary economy in which the central bank follows an interest rate peg. In contrast to the fiscal theory of the price level (FTPL), such strategies always satisfy a government intertemporal budget...

In this paper I analyze the classes of price-paths arising from a non-Ricardian fiscal monetary plan along the lines of the Fiscal Theory of the Price Level (FTPL), under a price invariant nominal money supply rule in a standard Sidrauski-Brock model. I first show that fiscalist speculative...

I examine the postulates of the Fiscal Theory of the Price Level (FTPL) under a nominal interest rate peg. First, I show that the usual definition of a non-Ricardian plan involves a number of government's non-credible policy commitments, thus confuting the interpretation of the FTPL as a...

The EU's transposition of Basel II into European law has been done through the Capital Requirements Directive (CRD). Although the Directive establishes, in general, uniform rules to set capital requirements across European countries, there are some areas where the Directive allows some...

Cross-border bank flows are experiencing a protracted contraction after the global financial crisis, in stark contrast with the recovery of other capital flows. The process can be driven by ongoing shifts in global banks international funding patters. Banks net issuances in international markets...

This paper focuses on the non linear adjustment of import prices in national currency to shocks in exchange rates and foreign prices measured in the exporters' currency of products originating outside the euro area and imported into European Union countries (EU 15). The paper looks at three...

The paper studies the evolution and determinants of banking integration across European countries, including New Member States, with attention to the impact that the Euro might have on that process. It is the first time that banking integration is being studied using the data on international...