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The paper analyses the common European monetary policy based on a Mises-Hayek overinvestment framework, which is combined with the theory of optimum currency areas. It shows how since the turn of the millennium a too expansionary monetary policy contributed to unsustainable overinvestment booms...
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In this paper we suggest that Eurozone countries face a policy trade-off among: 1) a common rule imposing co … conclude that the intense fiscal rules that have been introduced in the Eurozone after the emergence of the debt crisis reduced …
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We argue that the various proposals aimed at stabilizing the Eurozone using financial engineering do not eliminate the … amount of financial engineering can stabilize an otherwise unstable system. The real stabilization of the Eurozone entails … two mechanisms. The first is the willingness of the European Central Bank (ECB) to provide liquidity in the Eurozone …
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