ABSTRACT This paper discusses sources of self‐fulfilling equilibria in the Eurozone when some governments are highly susceptible to movements of distrust by investors who fear some payment difficulty. Self‐fulfilling prophecies occur when countries become insolvent only because investors...

ABSTRACT This special issue provides several views about the sources of the current crisis and policy solutions to cope with it. It brings together papers from academic institutions, international organizations and central banks. The first three papers argue that the crisis was triggered by the...

This introduction presents a selection of articles dealing with the issue of measuring the fiscal and financial vulnerabilities in the advanced economies. These articles were presented at a conference organized jointly by the Banque de France and BETA in Strasbourg on 13--14 September. The...