EconPapers    
Economics at your fingertips  
 

Mutualizing Euro Area debt without a Fiscal Union

Stefan Krause Montalbert

Revista de Ciencias Económicas, 2018, vol. 36, issue 2

Abstract: Several years have passed since the onset of the most recent financial crisis, and Europe is still not “off the hook.” A twin crisis emerged: the sovereign debt crisis. The main objective of this paper is to design a mechanism for pooling Euro Area debt together, in order to lower short-term interest rates, and limit the risk of contagion. This design, which draws from existing proposals for jointly issued bonds in the Euro Area, contains features that would make it acceptable for participants (such as no ex-ante fiscal transfers across countries, and widespread benefits from lower debt-service payments), while placing a reasonable cap on potential losses from default by other participants through limited liability.

Keywords: Euro Area; sovereign debt crisis; monetary policy; Eurobonds; Zona Euro; deuda soberana; política monetaria; euro-bonos (search for similar items in EconPapers)
JEL-codes: A (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://revistas.ucr.ac.cr/index.php/economicas/article/view/35688 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rce:rvceco:35688

Access Statistics for this article

Revista de Ciencias Económicas is currently edited by Fabricio Marín Rodríguez

More articles in Revista de Ciencias Económicas from Instituto de Investigaciones en Ciencias Económicas, Universidad de Costa Rica Contact information at EDIRC.
Bibliographic data for series maintained by Jose Antonio Cordero ().

 
Page updated 2020-07-23
Handle: RePEc:rce:rvceco:35688