Advanced Search
MyIDEAS: Login to save this paper or follow this series

Lost at Sea: The Euro Needs a Euro Treasury

Contents:

Author Info

  • Jörg Bibow
Registered author(s):

    Abstract

    The euro crisis remains unresolved even as financial markets may seem calm for now. The current euro regime is inherently flawed. Recent reforms have failed to turn the dysfunctional euro regime into a viable one. The investigation is informed by the "cartalist" critique of traditional "optimum currency area" theory (Goodhart 1998). Various proposals to rescue the euro are assessed and found lacking. A Euro Treasury scheme operating on a strict rule and specifically designed not to be a transfer union is proposed here as condition sine qua non for healing the euro's potentially fatal birth defects. The Euro Treasury proposed here is the missing element that will mend the current fiscal regime that is unworkable without it. The proposed Euro Treasury scheme would end the currently unfolding euro calamity by switching policy from a public thrift campaign that can only impoverish Europe to a public investment campaign designed to secure Europe's future. No mutualization of existing national public debts is involved. Instead, the Euro Treasury is established as a means to pool eurozone public investment spending and have it funded by proper eurozone treasury securities.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.boeckler.de/pdf/p_imk_study_35_2013
    Our checks indicate that this address may not be valid because: 500 Can't connect to www.boeckler.de:80 (10060). If this is indeed the case, please notify (Sabine Nemitz)
    Download Restriction: no

    Bibliographic Info

    Paper provided by IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute in its series IMK Studies with number 35-2013.

    as in new window
    Length: 61 pages
    Date of creation: 2013
    Date of revision:
    Handle: RePEc:imk:studie:35-2013

    Contact details of provider:
    Postal: Hans-Böckler-Straße 39, 40476 Düsseldorf
    Phone: +49 211 7778 234
    Fax: +49 211 7778 4234
    Email:
    Web page: http://www.imk-boeckler.de
    More information through EDIRC

    Related research

    Keywords:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Hein, Eckhard & Truger, Achim, 2013. "Future fiscal and debt policies: Germany in the Context of the European Monetary Union," IPE Working Papers, Berlin School of Economics and Law, Institute for International Political Economy (IPE) 24/2013, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    2. J. Bradford DeLong & Lawrence H. Summers, 2012. "Fiscal Policy in a Depressed Economy," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 44(1 (Spring), pages 233-297.
    3. Gennaro Zezza, 2012. "The impact of fiscal austerity in the Eurozone," Review of Keynesian Economics, Edward Elgar, Edward Elgar, vol. 1(0), pages 37-54.
    4. Marco Buti & Nicolas Carnot, 2012. "The EMU Debt Crisis: Early Lessons and Reforms," Journal of Common Market Studies, Wiley Blackwell, Wiley Blackwell, vol. 50(6), pages 899-911, November.
    5. Gregor Semieniuk & Till van Treeck & Achim Truger, 2011. "Nothing learned from the crisis? Some remarks on the Stability Programmes 2011-2014 of the Euro area governments," IMK Working Paper, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 11-2011, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    6. DREZE, Jacques & DURRE, Alain, 2013. "Fiscal integration and growth stimulation in Europe," CORE Discussion Papers, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) 2013013, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    7. James, Harold, 2012. "Making the European Monetary Union," Economics Books, Harvard University Press, Harvard University Press, number 9780674066830.
    8. Gregor Semieniuk, 2012. "Still focused on public deficits. Some remarks on the euro area stability programmes 2012-2015," IMK Working Paper, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 101-2012, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    9. Ashoka Mody & Stijn Claessens & Shahin Vallée, 2012. "Paths to Eurobonds," IMF Working Papers, International Monetary Fund 12/172, International Monetary Fund.
    10. Panizza, Ugo & Presbitero, Andrea F., 2014. "Public debt and economic growth: Is there a causal effect?," Journal of Macroeconomics, Elsevier, Elsevier, vol. 41(C), pages 21-41.
    11. Michael D. Bordo & Agnieszka Markiewicz & Lars Jonung, 2011. "A Fiscal Union for the Euro: Some Lessons from History," NBER Working Papers 17380, National Bureau of Economic Research, Inc.
    12. Jakob von Weizsäcker & Jacques Delpla, 2010. "The Blue Bond Proposal," Policy Briefs 403, Bruegel.
    13. Nicolas Veron & Guntram B. Wolff, 2013. "From Supervision to Resolution: Next Steps on the Road to European Banking Union," Policy Briefs PB13-5, Peterson Institute for International Economics.
    14. Stephanie Kelton, 2011. "Limitations of the Government Budget Constraint: Users vs. Issuers of the Currency," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 58(1), pages 57-66, March.
    15. Jorg Bibow, 2013. "On the Franco-German Euro Contradiction and Ultimate Euro Battleground," Economics Working Paper Archive, Levy Economics Institute wp_762, Levy Economics Institute.
    16. Olivier J. Blanchard & Daniel Leigh, 2013. "Growth Forecast Errors and Fiscal Multipliers," American Economic Review, American Economic Association, American Economic Association, vol. 103(3), pages 117-20, May.
    17. Jörg Bibow, 2004. "Reflections on the current fashion for central bank independence," Cambridge Journal of Economics, Oxford University Press, Oxford University Press, vol. 28(4), pages 549-576, July.
    18. Valila, Timo & Mehrotra, Aaron, 2005. "Evolution And Determinants Of Public Investment In Europe," Economic and Financial Reports, European Investment Bank, Economics Department 2005/1, European Investment Bank, Economics Department.
    19. George S. Tavlas, 1993. "The ‘New’ Theory of Optimum Currency Areas," The World Economy, Wiley Blackwell, Wiley Blackwell, vol. 16(6), pages 663-685, November.
    20. Michael D. Bordo & Lars Jonung, 1999. "The Future of EMU: What Does the History of Monetary Unions Tell Us?," NBER Working Papers 7365, National Bureau of Economic Research, Inc.
    21. George S. Tavlas, 2009. "Optimum-Currency-Area Paradoxes," Review of International Economics, Wiley Blackwell, Wiley Blackwell, vol. 17(3), pages 536-551, 08.
    22. Eckhard Hein & Achim Truger, 2006. "Fiscal Policy and Macroeconomic Performance in the Euro area - Lessons for the Future," IMK Working Paper, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 07-2006, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    23. Guntram B. Wolff, 2012. "A budget for Europe's monetary union," Policy Contributions, Bruegel 762, Bruegel.
    24. Jakob von Weizsäcker & Jacques Delpla, 2011. "Eurobonds: The blue bond concept and its implications," Policy Contributions, Bruegel 509, Bruegel.
    25. Dirk Schoenmaker, 2013. "Post-Crisis Reversal in Banking and Insurance Integration: An Empirical Survey," European Economy - Economic Papers, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission 496, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
    26. Francesco Paolo Mongelli, 2005. "What is European Economic and Monetary Union Telling us About the Properties of Optimum Currency Areas?," Journal of Common Market Studies, Wiley Blackwell, Wiley Blackwell, vol. 43(3), pages 607-635, 09.
    27. Thomas J. Sargent & Neil Wallace, 1981. "Some unpleasant monetarist arithmetic," Quarterly Review, Federal Reserve Bank of Minneapolis, Federal Reserve Bank of Minneapolis, issue Fall.
    28. Willi Koll, 2013. "Neue Wirtschaftsregierung und Tarifautonomie in der Europäischen Union, Makroökonomische Koordinierung im Dialog," IMK Studies, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 30-2013, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:imk:studie:35-2013. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sabine Nemitz).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.