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The euro crisis: a view from the North

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  • Honkapohja, Seppo

Abstract

The paper provides an overview of the sovereign debt crisis. I first consider the build-up of the crisis.I then discuss policy choices when a financial crisis erupts and assess the adjustment processes in the crisis countries, including alternatives to policies of austerity. Finally I take up institutional improvements that can help in resolving the current crisis and avoiding a future one. These include the banking union and the strengthened Stability and Growth Pact and related institutional rules. Current high levels of public and private debt together with still weak bank balance sheets are a major unsolved problem. Publication

Suggested Citation

  • Honkapohja, Seppo, 2013. "The euro crisis: a view from the North," Bank of Finland Research Discussion Papers 12/2013, Bank of Finland.
    • Handle: RePEc:zbw:bofrdp:rdp2013_012
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    File URL: https://www.econstor.eu/bitstream/10419/212252/1/bof-rdp2013-012.pdf
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    References listed on IDEAS

    as
    1. Andersen, Torben M. & Holmström, Bengt & Honkapohja, Seppo & Korkman, Sixten & Söderström Hans Tson, & Vartiainen, Juhana, . "The Nordic Model. Embracing globalization and sharing risks," ETLA B, The Research Institute of the Finnish Economy, number 232, June.
    2. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "Varieties of Crises and Their Dates," Introductory Chapters, in: This Time Is Different: Eight Centuries of Financial Folly, Princeton University Press.
    3. Honkapohja, Seppo, 2012. "The 1980s financial liberalization in the Nordic countries," Bank of Finland Research Discussion Papers 36/2012, Bank of Finland.
    4. repec:zbw:bofrdp:2012_036 is not listed on IDEAS
    5. Mongelli, Francesco Paolo, 2013. "The mutating euro area crisis: is the balance between "sceptics" and "advocates" shifting?," Occasional Paper Series 144, European Central Bank.
    6. Carmen M. Reinhart & M. Belen Sbrancia1, 2015. "The liquidation of government debt," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 30(82), pages 291-333.
    7. Obstfeld, Maurice, 2013. "Finance at Center Stage: Some Lessons of the Euro Crisis," CEPR Discussion Papers 9415, C.E.P.R. Discussion Papers.
    8. Mongelli, Francesco Paolo, 2013. "The mutating euro area crisis: is the balance between "sceptics" and "advocates" shifting?," Occasional Paper Series 144, European Central Bank.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    financial crisis; sovereign debt; European integration; E62; E65; F36; Seppo Honkapohja;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration

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