Making the Euro Viable: The Euro Treasury Plan
Jörg Bibow
Economics Working Paper Archive from Levy Economics Institute
Abstract:
The euro crisis remains unresolved and the euro currency union incomplete and extraordinarily vulnerable. The euro regime's essential flaw and ultimate source of vulnerability is the decoupling of central bank and treasury institutions in the euro currency union. We propose a "Euro Treasury" scheme to properly fix the regime and resolve the euro crisis. This scheme would establish a rudimentary fiscal union that is not a transfer union. The core idea is to create a Euro Treasury as a vehicle to pool future eurozone public investment spending and to have it funded by proper eurozone treasury securities. The Euro Treasury could fulfill a number of additional purposes while operating mainly on the basis of a strict rule. The plan would also provide a much-needed fiscal boost to recovery and foster a more benign intra-area rebalancing.
Keywords: Economic and Monetary Union; Euro Crisis; Euro Treasury; Fiscal Union; Public Investment (search for similar items in EconPapers)
JEL-codes: E32 E62 E63 H62 H63 (search for similar items in EconPapers)
Date: 2015-07
New Economics Papers: this item is included in nep-cba, nep-eec, nep-mac, nep-mon and nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)
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Journal Article: Making the euro viable: the Euro Treasury Plan (2016) 
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Persistent link: https://EconPapers.repec.org/RePEc:lev:wrkpap:wp_842
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