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László Csaba ; Mit dt. Zsfassung ; Volltext // Exemplar mit der Signatur: München, Bayerische Staatsbibliothek -- 4 Z 68.247-1984,31/38

This dissertation asks three interrelated questions about economic policy coordination: (1) Why do we see persistent macroeconomic imbalances that make international coordination necessary? (2) What kind of economic policies does the European Union promote in its member states via its coordination framework, the European Semester? (3) What determines whether governments implement recommendations issued under the Semester? The first paper argues that economic ideas, and their emphasis in media reporting, help secure public support for policies that result in external imbalances. It finds that the dominant interpretations of current account balances in Australia and Germany concur with distinct perspectives: external surpluses are seen as evidence of competitiveness in Germany, while external deficits are interpreted as evidence of attractiveness for investments in Australia. Survey experiments in both countries suggest that exposure to these diverging interpretations of the current account has a causal effect on citizens' support for their country's economic strategy. The second and third papers analyse policy recommendations under the European Semester, arguably the most ambitious example of economic policy coordination worldwide. The findings show that the European Union does not use the Semester to promote a single economic model across all member states. Recommendations do not uniformly recommend more reliance on the market or the state. Rather, they tend to suggest fiscal restraint and less protection for labour market insiders, while simultaneously promoting measures that benefit vulnerable groups in society. During the second decade of EMU, recommendations have gradually become more favourable of state intervention. The fourth paper investigates possible reasons for (non-)compliance with the Semester. It argues that recommendations are more likely to be implemented when their policy direction is in line with national governments' economic ideology. The analysis shows that recommendations advocating less ...

Successive EMU roadmaps have presented the expansion of EU controls over Member States' economic policies as an integral part of monetary union, vital to its survival. Possible alternatives have been hardly discussed. In this contribution we trace the evolution of the EU economic policy coordination framework from a relatively narrow, rules-based exercise into a largely discretionary process that reaches even the most politically salient areas of the Member States' economic policies. We then discuss how the extensive coercive powers the EU formally possesses have turned out to be difficult to use in practice. This reflects the fundamental limits of the EU's legitimate use of power over its Member States, set by its current level of political and cultural integration. To have a chance of success, further designs EMU need to respect these limits. ; The ADEMU Working Paper Series is being supported by the European Commission Horizon 2020 European Union funding for Research & Innovation, grant agreement No 649396.

This thesis proposes an analysis of the triangle formed by monetary policy, prudential policy and bank's risk-taking. Accordingly, this thesis aims to study the effects of monetary policy on banks' risk-taking and to determine the conditions for monetary and prudential policy coordination in order to ensure the stability of the banking sector and the solvency of financial institutions. At the macroeconomic level, we also assess the impact of this coordination on domestic credit and on the expected cost of bank failure. The first chapter reviews the literature on theoretical and empirical analysis of the risk-taking channel, and the analysis of the issue of monetary policy coordination with prudential policy. This literature review reveals that the effects of monetary policy on bank risk-taking are not one-sided, calling into question our knowledge of the monetary risk-taking channel. Similarly, this chapter suggests that the nature of monetary and prudential policy coordination is not unique. The second chapter is devoted to an original empirical study on the risk-taking channel of monetary policy. Using a panel threshold model, we show that monetary policy has different effects depending on the "monetary regime" in which monetary policy is conducted. Thus, a fall in interest rates leads to more risk-taking if monetary policy is considered loose (interest rate below the Taylor rule rate). Conversely, when monetary policy is considered as restrictive (interest rate above Taylor's rule rate), a decrease in interest rate reduces banks risk level. The third chapter examines the impact of monetary policy on bank's risk according to the nature of prudential policy. Using a partial equilibrium model, we determine conditions under which monetary policy, in presence of a risk sensitive capital requirement ratio, would lead the bank to take more risk. The results show that the effects of monetary policy on banking risk are not independent of the nature of microprudential policy. The objectives of financial stability and ...

This thesis proposes an analysis of the triangle formed by monetary policy, prudential policy and bank's risk-taking. Accordingly, this thesis aims to study the effects of monetary policy on banks' risk-taking and to determine the conditions for monetary and prudential policy coordination in order to ensure the stability of the banking sector and the solvency of financial institutions. At the macroeconomic level, we also assess the impact of this coordination on domestic credit and on the expected cost of bank failure. The first chapter reviews the literature on theoretical and empirical analysis of the risk-taking channel, and the analysis of the issue of monetary policy coordination with prudential policy. This literature review reveals that the effects of monetary policy on bank risk-taking are not one-sided, calling into question our knowledge of the monetary risk-taking channel. Similarly, this chapter suggests that the nature of monetary and prudential policy coordination is not unique. The second chapter is devoted to an original empirical study on the risk-taking channel of monetary policy. Using a panel threshold model, we show that monetary policy has different effects depending on the "monetary regime" in which monetary policy is conducted. Thus, a fall in interest rates leads to more risk-taking if monetary policy is considered loose (interest rate below the Taylor rule rate). Conversely, when monetary policy is considered as restrictive (interest rate above Taylor's rule rate), a decrease in interest rate reduces banks risk level. The third chapter examines the impact of monetary policy on bank's risk according to the nature of prudential policy. Using a partial equilibrium model, we determine conditions under which monetary policy, in presence of a risk sensitive capital requirement ratio, would lead the bank to take more risk. The results show that the effects of monetary policy on banking risk are not independent of the nature of microprudential policy. The objectives of financial stability and ...

Previous studies have discounted important factors and indirect channels that might contribute to business cycle synchronization (BSC) in the EU. We estimate the effects of market integration and economic policy coordination on bilateral business cycle correlations over the period 1995-2012 using a simultaneous equations model that takes into accounts both the endogenous relationships and unveils direct and indirect effects. The results suggest that (i) trade and FDI have a pronounced positive effect on BCS, particularly between incumbent and new EU members. (ii) Rising specialization does not decouple business cycles. (iii) The decline of income disparities in EU27 contributes to BCS, as converging countries develop stronger trade and FDI linkages. (iv) There is strong evidence that poor fiscal discipline of EU members is a major impediment of business cycle synchronization. (v) The same argument holds true for exchange rate fluctuations that hinder BCS, particularly in EU15. Since BCS is a fundamental prerequisite and objective in an effective monetary union, the EU has to promote market integration and strengthen the common setting of economic policies. (authors' abstract)

The subject of analysis in this paper is to review the institutional aspects of coordination mechanisms for economic policy in the European Union. In this context, the first part of the article defines the concept of coordination, the benefits versus the competition, the goals and the principles on which mechanisms are placed. In the second part of paper points to the impact of the mechanism for coordination of economic policy in Serbia, costs and benefits of the coordination process, i.e. primarily in the light of the new wave of coordination which started with the new model of economic governance during the global crisis embodied in the provisions of the European semester, the European Stabilisation Mechanism and the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union. The central hypothesis is based on the fact that Serbia its economic policy must shape according to European coordination mechanisms in the broadest sense, and not only in the field of monetary and fiscal policy, but also other segments of structural macroeconomic policies (labour market, as well as in the new areas such as environmental policy and cohesion policy) to achieve sustainable economic development. Although the domestic economic policymakers have done a lot on that plan, there is still a practical and logical need for the harmonisation of specific segments of economic policy and reducing the time lag in the implementation of the actions of economic policy.

The present paper first takes a step backwards with an attempt to situate the adoption of this Treaty in discussion of the SGP and the "Maastricht criteria" (the criteria for EMU membership fixed in the Maastricht Treaty) in a longer perspective of the sharing of competences for macroeconomic policy making within the EU from the initial Treaty to the Maastricht Treaty and the Stability and Growth Pact (SGP). It then presents the main features of the Fiscal Treaty and its relation to the SGP and draws some conclusions as regards the importance and relevance of this new step in the process of economic policy coordination. It concludes that the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union does not seem to offer a definitive solution to the problem of finding the appropriate budgetary-monetary policy mix in the EMU already well identified in the Delors report in 1989 and regularly emphasised ever since and now seriously aggravated due to the Crisis. Furthermore, the implementation of this Treaty may under certain circumstances contribute to an increase in the uncertainties as regards the distribution of the competences between the European Parliament and national parliaments and between the former and the Commission and the Council.

This paper addresses the issue of fiscal policy coordination in the context of the current crisis. It first aims at clarifying the economic rationale for fiscal policy coordination in a monetary union with decentralized fiscal authorities, and at exploring the foundations of the kind of coordination devices chosen, as well as the incentives and constraints on member states' governments arising from the fiscal rules in the Euro Zone, both in tranquil and in stormy economic times. We then proceed with an analysis of the difficulties arising from the heterogeneous nature of the Euro Zone. In Section 3, we explore some of the possible causes of heterogeneity, with an emphasis on the issue of collective action and country size, with the coexistence of large and small countries, facing different incentives and constraints, hence tending to adopt divergent strategies in the occurrence of common macroeconomic shocks. Section 4 addresses the possible evolution in automatic fiscal stabilizers and Section 5 documents the size and structure of national fiscal stimulus packages. The concluding section advocates a better mix of rules and discretionary coordination for fiscal policies in the Euro Zone.

This paper addresses the issue of fiscal policy coordination in the context of the current crisis. It first aims at clarifying the economic rationale for fiscal policy coordination in a monetary union with decentralized fiscal authorities, and at exploring the foundations of the kind of coordination devices chosen, as well as the incentives and constraints on member states' governments arising from the fiscal rules in the Euro Zone, both in tranquil and in stormy economic times. We then proceed with an analysis of the difficulties arising from the heterogeneous nature of the Euro Zone. In Section 3, we explore some of the possible causes of heterogeneity, with an emphasis on the issue of collective action and country size, with the coexistence of large and small countries, facing different incentives and constraints, hence tending to adopt divergent strategies in the occurrence of common macroeconomic shocks. Section 4 addresses the possible evolution in automatic fiscal stabilizers and Section 5 documents the size and structure of national fiscal stimulus packages. The concluding section advocates a better mix of rules and discretionary coordination for fiscal policies in the Euro Zone.

This paper addresses the issue of fiscal policy coordination in the context of the current crisis. It first aims at clarifying the economic rationale for fiscal policy coordination in a monetary union with decentralized fiscal authorities, and at exploring the foundations of the kind of coordination devices chosen, as well as the incentives and constraints on member states' governments arising from the fiscal rules in the Euro Zone, both in tranquil and in stormy economic times. We then proceed with an analysis of the difficulties arising from the heterogeneous nature of the Euro Zone. In Section 3, we explore some of the possible causes of heterogeneity, with an emphasis on the issue of collective action and country size, with the coexistence of large and small countries, facing different incentives and constraints, hence tending to adopt divergent strategies in the occurrence of common macroeconomic shocks. Section 4 addresses the possible evolution in automatic fiscal stabilizers and Section 5 documents the size and structure of national fiscal stimulus packages. The concluding section advocates a better mix of rules and discretionary coordination for fiscal policies in the Euro Zone.

This paper addresses the issue of fiscal policy coordination in the context of the current crisis. It first aims at clarifying the economic rationale for fiscal policy coordination in a monetary union with decentralized fiscal authorities, and at exploring the foundations of the kind of coordination devices chosen, as well as the incentives and constraints on member states' governments arising from the fiscal rules in the Euro Zone, both in tranquil and in stormy economic times. We then proceed with an analysis of the difficulties arising from the heterogeneous nature of the Euro Zone. In Section 3, we explore some of the possible causes of heterogeneity, with an emphasis on the issue of collective action and country size, with the coexistence of large and small countries, facing different incentives and constraints, hence tending to adopt divergent strategies in the occurrence of common macroeconomic shocks. Section 4 addresses the possible evolution in automatic fiscal stabilizers and Section 5 documents the size and structure of national fiscal stimulus packages. The concluding section advocates a better mix of rules and discretionary coordination for fiscal policies in the Euro Zone.

With a large-scale econometric world model we derive policy multipliers and the parameters for the utility functions for 10 EMU countries and for the ECB. The gains from cooperation are calculated by comparing two equilibria, a Nash and a cooperative equilibrium. The cooperative equilibrium is the result of the maximization of a weighted utility function for Euroland as a whole with the targets output gap and inflation. In the case of a "full" cooperation, where the 10 EMU countries coordinate their fiscal policy with the monetary policy of the ECB the welfare gains are very large for the whole Euro zone. However the strong fiscal and monetary policy impulses as a result of this optimization procedure lead, firstly, to a violation of the fiscal targets (budget deficit, public debt) of the Stability and Growth Pact which limits the room for manoeuvre of fiscal policy of the EMU member states in stage III of EMU. Secondly, we find that not in all countries cooperation leads to welfare gains, a result which is not Pareto efficient. Therefore, by considering these two constraints (Pareto optimality and SGP objectives) the constrained optimization results in a solution in case of "full" cooperation which drives most countries back to the Nash position of the baseline. In addition, a "partial" cooperation in which the ECB stays aside and only the fiscal policies of the EMU member countries are taking part, leads to a very small welfare improvement and violates again (only to minor degree the Pareto optimality condition). The optimal fiscal policy impulses are very modest.

Sufficiently flexible labour markets are considered an important precondition for countries to benefit from membership in the monetary union.Economic policy coordination within the European Community is extensive and includes issues related to labour market structures.In this paper we study the determination of flexibility of the labour market and, ultimately, of wages in a member country of the monetary union.As a starting point, the analysis assumes that each country's government, in formulating its labour market policy, decides the degree of nominal wage flexibility in light of the fact that this involves political costs that increase with the degree of wage flexibility.The study then focuses on the effects of monetary union membership on each country's prospects for coordination of economic policies - specifically labour market policies.The study shows that coordination of labour market policies contributes to greater nominal wage flexibility in member countries.However, coordination of labour market policies will be effective only if unemployment is persistent or under discretionary monetary policy.From the perspective of macroeconomic stability, there is no particular need for coordinating labour market policies among member countries if the common central bank can credibly precommit to a low inflation target or if fluctuations in unemployment are white noise.

Contents: 1. Jürgen von Hagen, Jean Pisani-Ferry - Forum Economique Franco-Allemand /Deutsch-Französisches Wirtschaftspolitisches Forum .1 -- 2. Karel Lannoo - Financial Supervision in EMU .3 -- 3. Charles Wyplosz - Economic Policy Coordination in EMU: Strategies and Institutions.36 -- 4. Agnès Bénassy-Quéré - Summary of the Proceedings of the Fourth Franco-German Forum .61