Policymakers in the EU member states are currently shaping rescue packages to prevent the financial crisis hitting their economies with unmitigated force. Each government is responding to the emerging problems with a country-specific set of measures. Given the global nature of the crisis, would...

Schmieding, H.: The case against a common fiscal boost in Europe. - S. 4-9 Gros, D.: Covergence and divergence in public finance. - S. 10-12 Boeri, T.: Seizing the European day. - S. 13-15 Belke, A.: Fiscal stimulus packages, uncertainty and economic crisis: is the option of waiting valuable? -...

We show that macroprudential regulation can considerably dampen the impact of global financial shocks on emerging markets. More specifically, a tighter level of regulation reduces the sensitivity of GDP growth to VIX movements and capital flow shocks. A broad set of macroprudential tools...

If monetary policy is to aim also at financial stability, how would it change? To analyze this question, this paper develops a general-form framework. Financial stability objectives are shown to make monetary policy more aggressive: in reaction to negative shocks, cuts are deeper but...