The Euro Area and the Financial Crisis

by Beblavy, Miroslav; Cobham, David; Odor, Ludovit

• ISBN13: 9781107014749
• ISBN10: 1107014743
• Format: Hardcover
• Copyright: 2011-11-21
• Publisher: Cambridge Univ Pr

Summary

The financial crisis of 2007-2010 has presented a number of key policy challenges for those concerned with the long-term stability of the euro area. It has shown that price stability as provided by the European Central Bank is not enough to guarantee financial stability, and exposed fault lines in governance and deficiencies in the architecture of the financial supervisory and regulatory framework. This book addresses these and other issues, including why the crisis affected some countries more than others, whether the euro is still attractive for new EU states, and what policy changes and structural reforms, both macro and micro, should be undertaken to ensure its future viability. Written by a team of leading academic and central bank economists, the book also includes chapters on the cross-country incidence of the crisis, the Irish crisis and ECB monetary policy during the crisis, and studies on Spain, the Baltics, Slovakia and Slovenia.

Table of Contents

List of figures	p. viii
List of tables	p. xi
List of boxes	p. xiv
List of contributors	p. xv
List of abbreviations and acronyms	p. xvii
Introduction	p. 1
Towards a new architecture for financial stability in Europe	p. 8
The experience of the crisis
Weathering the financial storm: the importance of fundamentals and flexibility	p. 23
The Irish crisis	p. 59
The crisis in Spain: origins and developments	p. 81
The financial crisis and the Baltic countries	p. 97
Accession to the euro area
The road to euro adoption: a comparison of Slovakia and Slovenia	p. 131
Is the euro really a 'teuro'? The effects of introducing the euro on prices of everyday non-tradables in Slovakia	p. 157
The euro's contribution to economic stability in Central, Eastern and Southeastern Europe: is euro adoption still attractive?	p. 184
Is the euro still attractive for CEE countries?	p. 190
The future of the euro area
Why the current account may matter in a monetary union: lessons from the financial crisis in the euro area	p. 199
National fiscal rules within the EU framework	p. 222
The road to better resolution: from bail-out to bail-in	p. 243
Financial stability and monetary policy: lessons from the euro area	p. 262
Is there a case for price-level targeting?	p. 292
Heterogeneity in the euro area and why it matters for the future of the currency union	p. 320
The euro area: how to regain confidence?	p. 329
How to regain confidence in the euro area?	p. 335
How to save the euro? Lessons from the US	p. 340
Index	p. 344
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