News Archive

In July 2017, Louis Rouanet argued that the bail out of two Italian banks, Veneto Banca and Banca Popolare di Vicenza, would be a ‘deathblow to the European Banking Union’. EconPol researcher Timo Wollmershäuser agrees, and says the correlation between risk premia for sovereigns and banks has since sharply increased to the high levels observed before the start of the Banking Union.

In our latest working paper, António Afonso and João Tovar Jalles assess, via system GMM, how Stock Flow Adjustments (SFA) affect the debt-to-GDP ratio in 65 countries (covering developed and emerging and low-income countries) between1985-2014. They find that SFAs positively contribute to the change in the debt-to-GDP ratio with a coefficient close to one.

EconPol Europe, the European network for economic and fiscal policy research, has welcomed five new associate partners to expand its reach into Czech Republic, the Netherlands, Portugal, Spain and Switzerland. The new associates join founding partners in Germany, France, the UK, Finland, Austria, Italy and Belgium to take the total number of university and non-university institutions in the network to 14.

With negotiations between the EU and UK reaching deadlock, the only way forward seems to be a hard Brexit. In this policy brief, the authors suggest a model which will avoid a ‘no deal’ scenario and find that a minimum three-month extension is necessary in order to establish a European Customs Association.

A new policy report from EconPol Europe provides the first analysis to evaluate an unemployment re-insurance scheme for the euro area as regards potential stabilizing and redistributive effects. The novel feature of the study is that it separates the stabilization effects of the re-insurance scheme into two channels relevant to the current political debate: First, it indicates the potential for stabilization through payments between countries (so-called interregional stabilization). Second, the study estimates the so-called intertemporal stabilization potential. The distinction between the two stabilization channels is crucial for assessing the possible value added of different reform options.