Prior to EMU, fiscal policy within the EU was disciplined by the threat of exclusion of the single currency; post-EMU, discipline has been exerted through the provisions of the Stability and Growth Pact. In this paper, we contrast the discipline induced by the two separate regimes on three...

Europe’s financial landscape has substantial institutional variety. This reflects different societal responses to (or preferences with regard to) trade-offs. For monetary policy, it implies a challenging environment, particularly in times of financial crises. Using a non-linear VAR-model we...

Compared to the U.S., the euro area has been underperforming in the wake of the Great Financial Crisis (GFC). This holds especially true for peripheral euro area economies. Whereas the U.S. is characterised by a financial system dominated by arms’ length (capital-market oriented) interaction...

The consequences of diversity over a number of pertinent dimensions is often not adequately acknowledged in economics. As Reinhard H. Schmidt (in this issue) states: “One could easily cite important recent research contributions with no traces of institutions and institutional differences of...