We advocate a dynamic approach to monetary convergence to a common currency that is based on the analysis of financial system stability. Accordingly, we empirically test volatility dynamics of the tenyear sovereign bond yields of the 2004 EU accession countries in relation to the eurozone yields...

In this paper, the capital market relations between the Euro area and the USA are subject to investigation. Formally based on the uncovered interest rate parity (UIP), first a longrun equilibrium between Euro and US government bond yields is established in backward recursively estimated vector...

The financial crisis has highlighted the need for models that can identify counterparty risk exposures and shock transmission processes at the systemic level. We use the euro area financial accounts (flow of funds) data to construct a sector-level network of bilateral balance sheet exposures and...

In the debate on global imbalances, the euro area countries did not receive much attention so far. While the current account is on balance for the entire area, divergences between individual member states have increased since the introduction of the common currency. In this paper, the imbalances...

Not since the Great Depression have monetary policy matters and institutions weighed so heavily in commercial, financial, and political arenas. Apart from the eurozone crisis and global monetary policy issues, for nearly two years all else has counted for little more than noise on a relative...

In the debate on global imbalances, the euro area countries did not receive much attention so far. While the current account is on balance for the entire area, divergences between individual member states have increased since the introduction of the common currency. In this paper, the imbalances...

Die Beschlüsse des Euro-Gipfels vom Juni 2012 haben bei deutschen Ökonomen heftige Kritik ausgelöst. Der Autor fragt, welche Konsequenzen es gehabt hätte, wenn die Ratschläge der Ökonomen schon in der Finanzkrise 2008 befolgt worden wären, und befürchtet, dass der Verzicht auf eine am...

In July 1990, the project of the European Monetary Union (EMU) started and finally led to the introduction of the Euro in January 1999. This paper analyses the development of the government bond market integration during the three stages of the EMU. Based on the results from dynamic conditional...

This paper discusses proposals for common euro area sovereign securities. Such instruments can potentially serve two functions: in the short-term, stabilize financialmarkets and banks and, in the medium-term, help improve the euro area economic governance framework through enhanced fiscal...

In the debate on global imbalances, the euro area countries did not receive much attention so far. While the current account is on balance for the entire area, divergences between individual member states have increased since the introduction of the common currency. In this paper, the imbalances...