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Purpose This paper aims to briefly review the literature on interest rate convergence and the European debt crisis with a special focus on the current fiscal problems of some governments in Europe.Design/methodology/approach Relevant empirical papers are identified and reviewed focusing on time series analysis techniques.Findings The introduction of the euro has caused interest rate convergence among European Monetary Union (EMU) government bond yields. However, now sovereign credit risk and possibly even redenomination risk have caused divergences in European bond markets.Research limitations/implications A major limitation is that a relatively new field of the literature is surveyed. However, there are enough papers of relevance. This review paper could therefore be helpful in finding new approaches for additional empirical research examining the EMU bond market.Originality/value The results of empirical studies in a relatively new field of the literature are summarized. There meanwhile are some relevant papers. A brief survey of the results of these papers is provided. Important empirical findings with regard to interest rate convergence, sovereign credit risk and redenomination risk in the EMU are discussed and evaluated. The review is especially helpful for researchers and practitioners in the field of managerial finance and risk managers in the financial services industry. [ABSTRACT FROM AUTHOR]

Within the current European economic landscape, plagued by financial, economic and national debt crises, a vivid debate has been sparked in the academic and professional environment regarding the way in which the European banking sector can contribute to the achievement of a long term sustainable economic growth. The debate is even more entailed since the financial crisis started in the banking sector and the main contagion happened through banks operating regionally and globally. Within this context, our paper aims at providing an overview of the main characteristics of the European banking sector and of the challenges that it will face in the post-crisis period. This represents a first necessary step in our opinion, for the better understanding of the way in which the European banking sector can contribute to the achievement of a long term sustainable economic growth. In order to achieve this we used a qualitative analysis combined with a series of empirical data and a series of own calculated indicators that underline some of the characteristics of the EU member states banking systems. [ABSTRACT FROM AUTHOR]

Until very recently, European employers and political leaders denied the need for any coordination in industrial relations at EU level. In 2011, however, the European Parliament and the Council adopted a new European economic governance regime that makes EU member states' labor policies subject to multilateral surveillance procedures. This paper analyzes this ‘silent revolution’ from above and assesses organized labor's responses to this challenge. It shows that the EU's new governance regime does not follow the classical model of a federal state, but rather the governance structures of multinational corporations that control their local subsidiaries through the use of whipsawing tactics and coercive comparisons. European trade unions' and social movements' difficulties in politicizing European economic governance are thus best explained by the ability of the new supranational EU regime to nationalize social conflicts. [ABSTRACT FROM PUBLISHER]

In the context of a cross-national economic crisis, questions about democratic legitimacy are again topical. We explore the question of democratic legitimacy in Portugal and Greece by employing the conceptual differentiation between diffuse and specific regime support. Our findings indicate that while specific support has fallen in both countries, only Greece has experienced a precipitous fall in diffuse support, suggesting a link between regime performance and support for democracy. Individual-level analyses do not reveal any clear patterns concerning the impact of long-term societal factors or short-term economic considerations. Due to data quality limitations the paper has a predominately exploratory nature. [ABSTRACT FROM AUTHOR]

The European Central Bank (ECB) has received a lot of criticism for its too little, too late performance to ease market pressures during the economic crisis. At the same time, the ECB and the Federal Reserve (Fed) have managed the new economic realities that have emerged in the international context differently. Despite the criticisms, the European Central Bank is the European Union institution that has assumed more control due to the new model of economic governance of the EU. Why did the Federal Reserve act so nimbly and quickly to calm the markets, while the ECB was so cautious in managing monetary policy? The aim of this paper is to perform a comparative analysis of the management of interest rates and other monetary policy measures undertaken by the Central Bank and the Federal Reserve during the economic crisis, as well as to understand the changes in the context of the ECB and the emergence of its authority within the European Union's economic governance model since 2011. Thus, in order to carry out a scrupulous exposition, we will also limit the time frame of this study to the 2007-2014 period. [ABSTRACT FROM AUTHOR]

Copyright of Revue d'Economie Politique is the property of Editions Dalloz Sirrey and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

We develop a model for analyzing the sovereign debt crises of 2010-2013 in the Eurozone. The government sets its expenditure-debt policy optimally. The need to sell large quantities of bonds every period leaves the government vulnerable to self-fulfilling crises in which investors, anticipating a crisis, are unwilling to buy the bonds, thereby provoking the crisis. In this situation, the optimal policy of the government is to reduce its debt to a level where crises are not possible. If, however, the economy is in a recession where there is a positive probability of recovery in fiscal revenues, the government also has an incentive to smooth consumption and increase debt. Our exercise identifies conditions on fundamentals for which the incentive to smooth consumption dominates, giving rise to a situation where governments optimally 'gamble for redemption,' running fiscal deficits and increasing their debt, thereby increasing their vulnerability to crises. [ABSTRACT FROM AUTHOR]

In the wake of the 2008 financial crisis and costly debt restructurings in Greece and Argentina, the sovereign debt restructuring regime (SDRR) has been reformed in a number of ways. Taken together, these reforms have had a mixed impact in comparison to existing governance arrangements put in place during the early 2000s: changes to IMF lending rules have weakened the regime, reforms to sovereign bond contracts have strengthened it, and a UN-centred initiative to construct a new multilateral debt restructuring framework has had little impact in either direction. The pattern of post-2008 change reveals that reforms focusing on pre-defined rules to trigger debt restructuring (the IMF lending reforms) areless likely to succeed than those focused on the process of restructuring once the decision to restructure has been taken (contract reforms). It also shows that efforts to build comprehensive, multilateral legal frameworks for debt restructuring (the initial goal of the UN initiative) face enormous obstacles. At a more theoretical level, the post-2008 experience highlights the enduring power of the United States and leading European states to shape outcomes in this sector, as well as the need to embrace eclectic theoretical frameworks in analysing the complicated politics of SDRR reform. [ABSTRACT FROM AUTHOR]

Accounts of crisis in Europe have proliferated since late 2009. This article investigates the relationship between the diagnosis of crisis and the cohesion and enlargement of the 'European project' in the context of Southeastern Europe. The article adoptsMichel Foucault's understanding of diagnosis as a strategic activity of language in order to re-construct the diagnostic discourse in relation to ongoing events in Greece and the Republic of Macedonia. Diagnostic practice produces accounts of crisis that are clinical, moralising, and prescriptive, affixing meanings to complex and overdetermined events in order that they can be acted upon. Diagnoses of the crises in Greece and Macedonia converge in their identification of political and cultural features of the national political economy in need of expert correction. The diagnosis of crisis emerges as an essential feature of European Union governmentality, which functions to delimit the bounds of political contestation in times of uncertainty and upheaval in favor of technocratic interventions. [ABSTRACT FROM AUTHOR]

This article argues that the Eurozone crisis has brought about two transformations in the basic rules of the EU economic constitution: the acceptance of public financial assistance to Eurozone Member States and the replacement of market discipline of domestic economies by bureaucratic discipline. Treating the measures adopted during the crisis and especially the response of the ECJ in Pringle and Gauweiler as constitutional transformations makes it possible to develop a narrative of the crisis that avoids two popular and opposing approaches that lead to a dead end: the wholesale acceptance of the legality of the measures adopted during the crisis on one hand, or their dismissal as simply illegal deviations from the EU constitutional framework on the other. In order to develop this constitutional narrative, the article borrows the theme framed by Weiler in his seminal article "The Transformation of Europe" and develops a constitutional interpretation of the moral hazard concept. [ABSTRACT FROM AUTHOR]

This article reads the current Eurocrisis going far beyond the classical linear explanations of the dualism between an imperialist core and a victimised periphery. Instead, it mobilises the concepts of social capital and of global imperialist chain to demonstrate the continuum between the agendas of the dominant classes in both the core and the periphery and the use of intergovernmental regional organisations as privileged tools for their strategies of exposing national capitals to international competition. Seen from this point of view, the current Eurocrisis is something far more complex than a mere exercise of domination of a major power (Germany, in this case) over peripheral economies: it is part of a strategy of redesigning the traditional model of welfare state, in which the Euro and the European Monetary Union work as dispositives of an hegemonic approach useful for the national bourgeoisies of the entire European space. [ABSTRACT FROM AUTHOR]

Copyright of Ayer: Revista de Historia Contemporánea is the property of Asociacion de Historia Contemporanea and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The euro crisis and a new debate about immigration in Europe have undermined support for the EU while the unsolved Greek debt problems as well as the ECB's quantitative easing policy have raised new crucial policy issues. It is necessary to identify the key issues of Eurozone stabilization and to clarify the economic benefits from monetary integration. As regards the economic welfare analysis of the euro, the new model presented shows the benefits of the euro's reserve currency position, namely in the framework of a neoclassical growth model with seigniorage based on international reserve holdings. Discounted benefits are about 10,000 € per capita in a stable Euro area. Thus the benefits are bigger than often considered, at the same time one may raise the question of whether the existing institutional setting of the Eurozone is sufficient for achieving long-term stability and prosperity. As regards the envisaged third rescue package for Greece it is emphasized that a haircut of public creditors along with adoption of a Greek capital levy plus privatization efforts are required to achieve debt sustainability and growth. The traditional interpretation of subsidiarity in the EU is found to be misleading and the vertical division of politics is destabilizing. [ABSTRACT FROM AUTHOR]

In the context of economic crisis, Europe has witnessed a spate of extraordinary political measures pressed by executive discretion. This article examines what emergency rule of this kind implies for the possibility of normal rule thereafter. Political decision-makers face the challenge of drawing a line under the crisis so that the unconventional measures used to handle it do not compromise the polity's norms in lasting fashion. Based on an analysis of the preconditions for plausibly making such an act of separation, I suggest the principal resources for doing so in the EU case are missing. Emergency rule will tend to blend in with normal rule, to the detriment of the political order's legitimate authority. A more dubiously grounded 'descriptive' authority may conversely be enhanced by emergency rule, as may compliance for instrumental motivations, producing a polity that is stable even if weakly legitimate. [ABSTRACT FROM AUTHOR]

Orthodox integration scholarship failed to identify the factors leading to the euro area (EA) economic and financial crisis because of weaknesses that Horkheimer identified in ‘traditional’ theory: disciplinary splits and a tendency to idealize from particular instrumental perspectives. By contrast, critical political economy offered a plausible and coherent elucidation of the emergent properties and limits of finance-led capitalism and their concrete manifestation in the EA. This contribution both reviews state-of-the-art critical political economy research on the EA crisis and makes a distinct contribution to it. In addressing the puzzle of why not only the Economic and Monetary Union persists despite morbid symptoms but why crisis management is extending and deepening a discredited finance-led capitalism, the contribution synthesizes theories of transnational class formation and inter-state relations, and proposes that Europe is caught in an ordoliberal iron cage. [ABSTRACT FROM PUBLISHER]

From November 2011 to the elections in February 2013, Italy was led by a tech- nocratic government, appointed to implement austerity measures in the context of the Eurozone debt crisis. While most of the political parties formally supported the government, some actors built their campaign around anti-system themes. This study proposes and discusses empirically two mechanisms by which such a blurred situation may have led Italian voters to discount ideological (left-right) considerations as a guideline for their own political identification and preference formation. Using data from a repeated cross-sectional survey running from March 2011 to February 2013, we investigate whether changes of the macro context affected the strength of the association between ideological self-positioning and the propensity to vote for the coalition leaders of the two ideologically rival blocks, i.e. the left-wing Democratic Party (Pd) and the right-wing People of Freedom (Pdl). Results show that our expectations are only partly corroborated by the data. First, we find that the effect of ideological labels on both parties' evaluations remains strong and persistent over time. Second, both the existence of a technocratic government and worsening economic conditions have had an impact on the evaluation of the Pdl, but not on the evaluation of the Pd. [ABSTRACT FROM AUTHOR]

In this article, the author traces the origins of the different and intertwined crises that the European Union (EU) is experiencing. He is critical of both the institutional set-up and substantive policy choices made by the EU prior to, as well as in response to, the European economic crisis. He argues that the EU has now entered a phase of constitutional mutation. He says that no current reform agenda is capable of protecting the basic values of the Rechtsstaat.

On the aftermath of the global credit crunch was made clear that the Euro countries debt crisis shows that the EMU is far from being an Optimal Currency Area (OCA) under its current form. The countries accepted bailouts from their counterparts and international organizations in order to prevent the Eurozone collapse spreading the crisis further. Can the breakup to multiple areas help as Tootel (1990) suggested? Three possible sets of OCA scenarios are analyzed along with the demolition scenario. The breakup of the Eurozone to two currencies consisting possible OCAs along with a second one adding all the EU members and a third one applying in small regions. The scenarios are analyzed by using eleven equally weighted optimum area criteria to make Eurozone a single or a set of sustainable OCAs. These type and extension scenarios are presented for the first time for EU countries finding possible sets of independent country groups. The results show that the asymmetries lead to the crisis persist in a possible two or more "euros" area and this scenario cost is higher than union dissolution's. Europe cannot become in its current form a set of OCAs under any circumstances. [ABSTRACT FROM AUTHOR]

The sovereign debt crisis and economic collapse of Greece is not a national exception. The eurozone and the entire EU are now the epicenter of the world capitalist crisis that exploded in 2007. Greece is the weakest link of the European chain that is threatened to break apart with enormous consequences for the world economy. All the interventions by the EU led by Germany, by the European Central Bank and the IMF were socially disastrous and economically totally inefficient. The second bailout of Greece in February 2012 has been met with a powerful resistance by the Greek popular masses and has no more chances to succeed than the previous one. No EU financial mechanism or ‘firewall’ is capable of preventing the contagion, which involves now not only small peripheral countries like Portugal or Ireland but the third and fourth biggest European economies, Italy and Spain, and starts to hit the ‘hard core’ of the EU. The crisis manifests the historical decline of capitalism in its birthplace, the European Continent, as well as the decline of bourgeois democracy. A new era of historical social confrontations has opened where the question of political power and of the future of Europe has been explicitly posed. [ABSTRACT FROM AUTHOR]

Globalisation and the emergence of economic players such as Brazil, Russia, India and China (BRIC) have led to predictions that US hegemony will quickly decline as a new world order emerges. With the European Union (EU) also facing a downgrading of its own status - as economic, political and cultural power shifts from west to east - now is the time to ensure the Union has a strategy in place to remain an influential global actor despite its lack of natural resources and member state sovereign debt arising from the 2008/9 economic crisis. Only concerted efforts at institutional future-proofing (or widening and deepening plus) by the EU and a global vision for the supranational body will ensure its survival and prosperity. [ABSTRACT FROM AUTHOR]