Flexibility Versus Stability: A Difficult Tradeoff in the Eurozone
JOURNAL ARTICLE
Cite JOURNAL ARTICLE
Style
Format
Flexibility Versus Stability: A Difficult Tradeoff in the Eurozone
Credit and Capital Markets – Kredit und Kapital, Vol. 49(2016), Iss. 3 : pp. 375–413 | First published online: October 03, 2017
10 Citations (CrossRef)
Additional Information
Article Details
Author Details
Paul De Grauwe, London School of Economics, Houghton Street, London, UK
SSEES, University College London, Gower Street, London, UK
Cited By
-
Purchase of government bonds by a supranational central bank: its impact on business cycles
Nakao, Masato | Asada, ToichiroEvolutionary and Institutional Economics Review, Vol. 19(2022), Iss. 1 P.395
https://doi.org/10.1007/s40844-021-00207-3 [Citations: 1] -
Business cycles and macroeconomic asymmetries: New evidence from Eurozone and European countries
Chionis, Dionysios | Mitropoulos, Fotios | Sarantidis, AntoniosInternational Journal of Finance & Economics, Vol. 26(2021), Iss. 4 P.5977
https://doi.org/10.1002/ijfe.2104 [Citations: 3] -
Does Regional Economic Integration is a Response to Globalisation?
Jiang, Yiping
Academic Journal of Management and Social Sciences, Vol. 3(2023), Iss. 2 P.114
https://doi.org/10.54097/ajmss.v3i2.10371 [Citations: 0] -
Optimal Spatial Allocation of Labour Force and Employment Protection Legislation (EPL)
Gamito, Carlos Coca | Baltos, GeorgiosBulletin of Geography. Socio-economic Series, Vol. 45(2019), Iss. 45 P.45
https://doi.org/10.2478/bog-2019-0023 [Citations: 0] -
Entrepreneurial and Demographic Challenges in Economic Development of EU Candidate Countries
Genesis and Overall Development Potential of the European Union
2024
https://doi.org/10.4018/979-8-3693-5568-8.ch001 [Citations: 0] -
Could the Boom‐Bust in the Eurozone Periphery Have Been Prevented?
Bielecki, Marcin | Brzoza‐Brzezina, Michał | Kolasa, Marcin | Makarski, KrzysztofJCMS: Journal of Common Market Studies, Vol. 57(2019), Iss. 2 P.336
https://doi.org/10.1111/jcms.12795 [Citations: 7] -
The policy mix in a monetary union: Who bears the burden of asymmetric shocks' stabilisation?
Mavrodimitrakis, Christos
International Journal of Finance & Economics, Vol. 29(2024), Iss. 4 P.3861
https://doi.org/10.1002/ijfe.2833 [Citations: 1] -
Back to the Future: Lessons from the 2009–2012 austerity policies for the aftermath of the COVID crisis
García, Alfredo Arahuetes | Bengoechea, Gonzalo GómezGlobal Policy, Vol. 13(2022), Iss. 5 P.751
https://doi.org/10.1111/1758-5899.13129 [Citations: 0] -
Stability of business cycles and economic openness of monetary union
Nakao, Masato
Evolutionary and Institutional Economics Review, Vol. 16(2019), Iss. 1 P.65
https://doi.org/10.1007/s40844-019-00124-6 [Citations: 2] -
Unconventional monetary policies and credit co-movement in the Eurozone
Sleibi, Yacoub | Casalin, Fabrizio | Fazio, GiorgioJournal of International Financial Markets, Institutions and Money, Vol. 85(2023), Iss. P.101779
https://doi.org/10.1016/j.intfin.2023.101779 [Citations: 8]
Abstract
The optimal currency areas (OCA) theory has been influential in pushing eurozone countries towards structural reforms to make product and labour markets more flexible. The underlying assumption of the OCA prescription for structural reform is that asymmetric shocks are permanent. However, when shocks are temporary it does not follow that more flexibility is the answer. When shocks are the result of business cycle movements, the way to deal with them is by stabilisation efforts. We provide empirical evidence that suggests that the biggest shocks in the eurozone were the result of business cycle movements. These were relatively well synchronised, except for their amplitude. We argue that efforts to stabilise the business cycles should be strengthened relative to the efforts that have been made to impose structural reforms, and consider the implications for the governance of the eurozone.
Table of Contents
| Section Title | Page | Action | Price |
|---|---|---|---|
| Paul De Grauwe / Yuemei Ji: Flexibility Versus Stability: A Difficult Tradeoff in the Eurozone | 1 |