IDEAS home Printed from https://ideas.repec.org/p/spo/wpmain/infohdl2441-pm9j25k5p9bc8fsjhn1ov51ca.html
   My bibliography  Save this paper

On public debt in the euro area

Author

Listed:
  • Catherine Mathieu

    (Observatoire français des conjonctures économiques)

  • Henri Sterdyniak

    (Observatoire français des conjonctures économiques)

Abstract

The 2008 crisis led to a strong rise in public deficits and debts in most developed economies. These debts and deficits are currently Keynesian (i.e. required for macroeconomic stabilisation), as shown by low inflation and interest rates levels. Euro area public debts are not guaranteed by a lender of last resort. The rules enshrined in the Stability Pact and the Fiscal Treaty have no economic basis. The paper discusses federalist proposals such as a European Debt Agency or a European Treasury, and unconventional solutions, such as debt monetisation, buyback by the ECB, and even debt cancellation. It concludes in advocating for a rule-free economic policy coordination.

Suggested Citation

  • Catherine Mathieu & Henri Sterdyniak, 2019. "On public debt in the euro area," Sciences Po publications info:hdl:2441/pm9j25k5p9b, Sciences Po.
    • Handle: RePEc:spo:wpmain:info:hdl:2441/pm9j25k5p9bc8fsjhn1ov51ca
    as

    Download full text from publisher

    File URL: https://spire.sciencespo.fr/hdl:/2441/pm9j25k5p9bc8fsjhn1ov51ca/resources/2019-mathieu-on-public-debt-in-the-euro-area.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Silke Tober, 2015. "Monetary Financing in the Euro Area: A Free Lunch?," IMK Working Paper 152-2015, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    2. Catherine Mathieu & Henri Sterdyniak, 2009. "La globalisation financière en crise," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(3), pages 13-73.
    3. Paul De Grauwe, 2012. "A Fragile Eurozone in Search of a Better Governance," The Economic and Social Review, Economic and Social Studies, vol. 43(1), pages 1-30.
    4. repec:hal:spmain:info:hdl:2441/248c17h0i8asp35af48q3bv1v is not listed on IDEAS
    5. repec:pra:mprapa:42873 is not listed on IDEAS
    6. repec:hal:spmain:info:hdl:2441/5l6uh8ogmqildh09h84aj549j is not listed on IDEAS
    7. repec:dau:papers:123456789/4777 is not listed on IDEAS
    8. Charles Wyplosz, 2011. "Fiscal Discipline: Rules Rather Than Institutions," National Institute Economic Review, National Institute of Economic and Social Research, vol. 217(1), pages 19-30, July.
    9. André Grjebine, 2015. "La dette publique et comment s'en débarrasser," SciencePo Working papers Main hal-01502396, HAL.
    10. Carmelo Pierpaolo Parello & Vincenzo Visco, 2012. "The European Redemption Fund: A Comparison of Two Proposals," Politica economica, Società editrice il Mulino, issue 3, pages 273-306.
    11. Catherine Mathieu & Henri Sterdyniak, 2015. "Should we still use the concept of potential growth ?," Sciences Po publications 2015-30, Sciences Po.
    12. Andrew Watt, 2015. "Quantitative easing with bite: a proposal for conditional overt monetary financing of public investment," IMK Working Paper 148-2015, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    13. Hasan Doluca & Malte Hübner & Dominik Rumpf & Benjamin Weigert, 2012. "The European Redemption Pact: Implementation and macroeconomic effects," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 47(4), pages 230-239, July.
    14. Silke Tober, 2015. "Monetary Financing in the Euro Area: A Free Lunch?," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 50(4), pages 214-220, July.
    15. Michel Aglietta & Thomas Brand, 2013. "Un New Deal pour l'Europe," Post-Print hal-01670110, HAL.
    16. repec:imk:wpaper:131-2013 is not listed on IDEAS
    17. André Grjebine, 2015. "La dette publique et comment s'en débarrasser," Post-Print hal-01502396, HAL.
    18. Silke Tober, 2014. "Debt Redemption Fund: Conditio Sine Qua Non? Government Bonds in the Euro Area Crisis," IMK Working Paper 131-2014, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:hal:spmain:info:hdl:2441/pm9j25k5p9bc8fsjhn1ov51ca is not listed on IDEAS
    2. repec:hal:spmain:info:hdl:2441/f6h8764enu2lskk9p503i2pp3 is not listed on IDEAS
    3. repec:hal:spmain:info:hdl:2441/7gjmt2p0l896bo3oar8rqd4vvr is not listed on IDEAS
    4. Catherine Mathieu & Henri Sterdyniak, 2014. "Redemption?," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(1), pages 51-91.
    5. repec:hal:spmain:info:hdl:2441/eu4vqp9ompqllr09j0h14g91k is not listed on IDEAS
    6. Catherine Mathieu & Henri Sterdyniak, 2014. "In search of a better governance in the euro area," SciencePo Working papers Main hal-01053901, HAL.
    7. Catherine Mathieu & Henri Sterdyniak, 2012. "Faut-il des règles de politique budgétaire ?," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(7), pages 299-346.
    8. repec:hal:spmain:info:hdl:2441/eo6779thqgm5r489m6u1i2a0o is not listed on IDEAS
    9. André Grjebine, 2013. "L’eurosystème : un mécanisme de transferts en faveur des pays déficitaires ?: Le débat," Sciences Po publications info:hdl:2441/eo6779thqgm, Sciences Po.
    10. repec:hal:spmain:info:hdl:2441/63g6fe7kgp82vpg084ogo3keke is not listed on IDEAS
    11. Silke Tober, 2015. "Monetary Financing in the Euro Area: A Free Lunch?," IMK Working Paper 152-2015, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    12. repec:hal:spmain:info:hdl:2441/eo6779thqgm5r489maqa474kg is not listed on IDEAS
    13. repec:hal:wpspec:info:hdl:2441/eo6779thqgm5r489maqa474kg is not listed on IDEAS
    14. Catherine Mathieu & Henri Sterdyniak, 2013. "Do we need fiscal rules?," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(1), pages 189-233.
    15. repec:spo:wpecon:info:hdl:2441/eo6779thqgm5r489maqa474kg is not listed on IDEAS
    16. Catherine Mathieu & Henri Sterdyniak, 2019. "Euro Area Macroeconomics. Where Do We Stand 20 Years Later?," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(HS), pages 55-88.
    17. repec:hal:spmain:info:hdl:2441/dambferfb7dfprc9lip1oi0sn is not listed on IDEAS
    18. repec:hal:spmain:info:hdl:2441/299ncu2o1b92c9773ttpt45gsn is not listed on IDEAS
    19. Henri Sterdyniak, 2012. "Ramener à zéro le déficit public doit-il être l’objectif central de la politique économique ?," Sciences Po publications info:hdl:2441/c6t1fl36hv9, Sciences Po.
    20. repec:hal:spmain:info:hdl:2441/c6t1fl36hv9s7q89j8pa18291 is not listed on IDEAS
    21. repec:hal:spmain:info:hdl:2441/eu4vqp9ompqllr09j0h168m2j is not listed on IDEAS
    22. repec:hal:wpspec:info:hdl:2441/eo6779thqgm5r489m6u1i2a0o is not listed on IDEAS
    23. repec:spo:wpecon:info:hdl:2441/c6t1fl36hv9s7q89j8pa18291 is not listed on IDEAS
    24. repec:hal:wpspec:info:hdl:2441/c6t1fl36hv9s7q89j8pa18291 is not listed on IDEAS
    25. repec:spo:wpecon:info:hdl:2441/eo6779thqgm5r489m6u1i2a0o is not listed on IDEAS
    26. Fritz Breuss, 2016. "The Crisis Management of the ECB," WIFO Working Papers 507, WIFO.
    27. Christophe Blot & Jérôme Creel & Paul Hubert & Fabien Labondance, 2015. "The QE experience : Worth a try ?," Post-Print hal-03459951, HAL.
    28. Alexandra Ferreira-Lopes & Tiago Neves Sequeira, 2012. "Business Cycles Association in a Small Monetary Union: The Case of Switzerland," Spatial Economic Analysis, Taylor & Francis Journals, vol. 7(1), pages 9-30, March.
    29. Bartzokas, Anthony & Giacon, Renato & Macchiarelli, Corrado, 2022. "Exogenous shocks and proactive resilience in the EU," MERIT Working Papers 2022-025, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    30. repec:dau:papers:123456789/12010 is not listed on IDEAS
    31. Andrea Bonilla‐Bolaños, 2021. "A step further in the theory of regional integration: A look at the South American integration strategy," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(5), pages 845-873, July.
    32. Giovanni Dosi & Marcello Minenna & Andrea Roventini & Roberto Violi, 2021. "Making the Eurozone work: a risk-sharing reform of the European Stability Mechanism," Annals of Operations Research, Springer, vol. 299(1), pages 617-657, April.
    33. Aglietta, Michel & Ahmed, Pepita Ould & Ponsot, Jean-François, 2014. "La monnaie, la valeur et la règle," Revue de la Régulation - Capitalisme, institutions, pouvoirs, Association Recherche et Régulation, vol. 16.
    34. Fabrizio Balassone & Sara Cecchetti & Martina Cecioni & Marika Cioffi & Wanda Cornacchia & Flavia Corneli & Gabriele Semeraro, 2018. "Economic governance in the euro area: balancing risk reduction and risk sharing," Chapters, in: Giuseppe Eusepi & Richard E. Wagner (ed.), Debt Default and Democracy, chapter 7, pages 124-154, Edward Elgar Publishing.
    35. Maylis Avaro & Henri Sterdyniak, 2014. "Banking union: a solution to the euro zone crisis?," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(1), pages 193-241.
    36. repec:hal:spmain:info:hdl:2441/166ip2fse39118p4oksocrf89u is not listed on IDEAS
    37. Deborah Mabbett & Waltraud Schelkle, 2014. "Searching under the lamp-post: the evolution of fiscal surveillance," Europe in Question Discussion Paper Series of the London School of Economics (LEQs) 5, London School of Economics / European Institute.
    38. Simon Wren-Lewis, 2015. "The Knowledge Transmission Mechanism and Austerity," IMK Working Paper 160-2015, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    39. repec:spo:wpecon:info:hdl:2441/7gjmt2p0l896bo3oar8rqd4vvr is not listed on IDEAS
    40. Bofinger, Peter & Buch, Claudia M. & Feld, Lars P. & Franz, Wolfgang & Schmidt, Christoph M., 2012. "Vom Binnenmarkt zur Bankenunion: Ein Vorschlag des Sachverständigenrates zur Begutachtung der gesamtwirtschaftlichen Entwicklung," Working Papers 09/2012, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung.

    More about this item

    Keywords

    Public debt; Euro area governance; Euro area fiscal policy; Debt management;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spo:wpmain:info:hdl:2441/pm9j25k5p9bc8fsjhn1ov51ca. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Spire @ Sciences Po Library (email available below). General contact details of provider: https://edirc.repec.org/data/ecspofr.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.