IDEAS home Printed from https://ideas.repec.org/p/iie/pbrief/pb10-27.html
   My bibliography  Save this paper

How Europe Can Muddle Through Its Crisis

Author

Listed:
  • Jacob Funk Kirkegaard

    (Peterson Institute for International Economics)

Abstract

Europe's financial market contagion is infecting systemically important eurozone members, causing a rise in demands that European policymakers make greater strides toward solutions. While Jacob Funk Kirkegaard believes that the European Union will do "whatever it takes" to save the euro and the eurozone, he argues that powerful political constraints prevent EU leaders from making optimal decisions. Europe can get through the current crisis by producing a compromise among member states in the form of a permanent European Stability Mechanism (ESM) with an option to issue a conditional Eurobond, which would aid eurozone members suffering asymmetric economic shocks in return for taking domestic reforms to return to a sustainable fiscal path. An ESM with a conditional Eurobond option offers a less clear-cut solution than a full fiscal union, a straightforward Eurobond, European Central Bank money-printing, or a breakup of the eurozone.

Suggested Citation

  • Jacob Funk Kirkegaard, 2010. "How Europe Can Muddle Through Its Crisis," Policy Briefs PB10-27, Peterson Institute for International Economics.
  • Handle: RePEc:iie:pbrief:pb10-27
    as

    Download full text from publisher

    File URL: https://www.piie.com/publications/policy-briefs/how-europe-can-muddle-through-its-crisis
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jacob Funk Kirkegaard, 2010. "In Defense of Europe's Grand Bargain," Policy Briefs PB10-14, Peterson Institute for International Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Shazia Ghani, 2011. "Is this all "Greek" in Europe ? Critical evaluation of the Euro zone policy response to debt crises," Post-Print halshs-00638723, HAL.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Carfì, D. & Magaudda, M. & Schilirò, D., 2010. "Coopetitive game solutions for the eurozone economy," MPRA Paper 26541, University Library of Munich, Germany.
    2. Patrick Leblond, 2011. "The Global Financial Crisis and the European Integration Project," CIRANO Working Papers 2011s-55, CIRANO.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iie:pbrief:pb10-27. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peterson Institute webmaster (email available below). General contact details of provider: https://edirc.repec.org/data/iieeeus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.