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Living (dangerously) without a fiscal union

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  • Ashoka Mody

Abstract

The euro area’s political contract requires member nations to rely principally on their own resources when confronted with severe economic distress. Since monetary policy is the same for all, national fiscal austerity is the default response to counter national fiscal stress. Moreover, the monetary policy was itself stodgy in countering the crisis, and banking-sector problems were allowed to fester. And it was considered inappropriate to impose losses on private sector...

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  • Ashoka Mody, 2015. "Living (dangerously) without a fiscal union," Working Papers 875, Bruegel.
  • Handle: RePEc:bre:wpaper:875
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    References listed on IDEAS

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    3. Giancarlo Corsetti & André Meier & Gernot J. Müller, 2012. "What determines government spending multipliers?," Economic Policy, CEPR;CES;MSH, vol. 27(72), pages 521-565, October.
    4. Christian Dustmann & Bernd Fitzenberger & Uta Sch?nberg & Alexandra Spitz-Oener, 2014. "From Sick Man of Europe to Economic Superstar: Germany's Resurgent Economy," Journal of Economic Perspectives, American Economic Association, vol. 28(1), pages 167-188, Winter.
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    6. Sven Steinkamp & Frank Westermann, 2014. "The role of creditor seniority in Europe's sovereign debt crisis," Economic Policy, CEPR;CES;MSH, vol. 29(79), pages 495-552, July.
    7. Schneider, Christina J. & Slantchev, Branislav L., 2018. "The Domestic Politics of International Cooperation: Germany and the European Debt Crisis," International Organization, Cambridge University Press, vol. 72(1), pages 1-31, January.
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    Cited by:

    1. Sergio Cesaratto, 2017. "Alternative interpretations of a stateless currency crisis," Cambridge Journal of Economics, Oxford University Press, vol. 41(4), pages 977-998.
    2. Schilirò, Daniele, 2016. "Rules, Imbalances and Growth in the Eurozone," MPRA Paper 75641, University Library of Munich, Germany.
    3. Schilirò, Daniele, 2017. "Imbalances and policies in the Eurozone," MPRA Paper 82847, University Library of Munich, Germany.
    4. Duffy, David & McQuinn, Kieran & Morley, Ciara, 2015. "Quarterly Economic Commentary, Autumn 2015," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20153, October.
    5. McQuinn, Kieran, 2015. "European Fiscal Policy During the Crisis: An Irish Perspective," Research Notes RN2015/3/3, Economic and Social Research Institute (ESRI).
    6. Erkki Karo & Rainer Kattel & Ringa Raudla, 2017. "Searching for Exits from the Great Recession: Coordination of Fiscal Consolidation and Growth Enhancing Innovation Policies in Central and Eastern Europe," Europe-Asia Studies, Taylor & Francis Journals, vol. 69(7), pages 1009-1026, August.

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