The Eurozone Crisis: Institutional Setting, Structural Vulnerability, and Policies

Bruno Dallago and Chiara Guglielmetti

No 1112, Openloc Working Papers from Public policies and local development

Abstract: The unfolding of the crisis in the Eurozone can be explained by the interaction of institutional features and policy failures, and by their interconnection with real and financial imbalances. The crisis has shown that internal divergence in the EZ is based on important structural components which are unsustainable in the long run. Indeed, the crisis has magnified the gap between the vulnerable peripheral member countries and a more resilient core. The paper analyses those factors that opened the way to the diffusion of the financial and economic crisis in the Eurozone. It also discusses the structural consequences of these events and critically analyses the institutional and political reforms which the Eurozone is facing in order to enhance its capability to cope with external shocks.

Keywords: Eurozone; European Union; European Monetary Union; euro; Common fiscal parameters; Real convergence; Productivity (search for similar items in EconPapers)
JEL-codes: E60 O10 P16 (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-cba and nep-eec
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:trn:utwpol:1112

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