This paper argues that Capital Markets Union - the EU's attempt to establish a more marketbased financial system - is a result less of financial policymaking than of macroeconomic governance in a politically fractured polity. The current governance structure of Economic and Monetary Union (EMU)...

The coronavirus disease (COVID-19) pandemic is the worst global crisis since the Second World War, with developing countries suffering more devastating economic and social effects than developed countries. Governments’ increased pandemic-related expenditure combined with the drastic fall in...

In the Covid-19 crisis, most OECD countries have used short-time work (subsidized working time reductions) to preserve employment relationships. This paper studies whether short-time work can save jobs through stabilizing aggregate demand in recessions. First, we show that the consumption risk...

This paper explores the link between default risk and fiscal procyclicality. We show that countries with higher sovereign risk have a more procyclical fiscal expenditure policy, which is driven mostly by transfers. We build a small open economy model with income inequality, social transfers, and...