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Lucia Quaglia

The financial woes experienced by the Monte dei Paschi di Siena (MPS) and by a handful of other Italian banks in which foundations have played a prominent role offer an opportunity to reflect on three interrelated topics. The first issue is the evolution of the Italian banking system and banking legislation over the past decades to explain the rather distinctive governance structure of these banks. The second issue is the unfolding of the sovereign debt crisis in the euro area, which set the broader context in which the MPS scandal and the subsequent financial troubles of other banks took place. The third issue is the main response of the European Union and euro area to the sovereign debt crisis, namely, the proposal to create an EU banking union, which in turn triggered strong supervisory actions by the Bank of Italy in preparation for the handover of banking supervision to the European Central Bank.

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Joachim Schild

France and Germany played a highly visible leadership role during the management of the Euro crisis and the efforts to design a reform governance framework for the Euro area. This article provides a conceptualization of this bilateral leadership, which is then applied to trace the process of Franco-German leadership during the ongoing crisis of the Euro area. Franco-German leadership grew ever more important as the crisis deepened. After the French presidential election of 2012, however, the divergences between the two core states of the Euro area deepened and made the exercise of joint leadership more difficult to achieve. I consider this leadership role to be based on a compromise by proxy logic in which France and Germany, starting from divergent positions, strike bilateral compromises acceptable to other member states that feel their own interests are represented by either France or Germany. Their common capacity to find suitable remedies to cope with crisis, however, is not beyond doubt. The Franco-German approach followed an additive logic, combining the temporary and permanent financial support schemes-a French preference-with a concomitant strengthening of fiscal rules advocated by Germany. In the end, the two governments did not develop a common comprehensive strategy based on a shared conceptual framework.

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Kenneth Dyson and Lucia Quaglia

After prolonged negotiations, on 24 June 2011, the governor of the

Bank of Italy, Mario Draghi, was appointed president of the European

Central Bank (ECB) as successor to Jean-Claude Trichet. His mandate

runs from 1 November 2011 to 31 October 2019. Draghi’s appointment

was consistent with a long-standing practice of Italian politicians and

officials seeking to engage with the process of European integration

by ensuring that they were “sitting at the European top table.” In the

context of the euro area, sitting at the top table for Italy was initially

about gaining euro entry as a founding member state in 1999 and,

subsequently, about having strong Italian representation in the governing

structures of the euro area, particularly the ECB. Once the

sovereign debt crisis became contagious in 2010–2011, it meant ensuring

that financial markets drew a clear distinction between Italy and

periphery member states such as Greece and Portugal that suffered

from sovereign debt distress.

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What Is Money?

A Definition Beyond Materiality and Quantity

Emanuel Seitz

—is much higher than the amount of cash. In January 2015, for example, the amount of cash was one-tenth of the countable monetary aggregates in the euro area ( European Central Bank 2015 ). Thus, there is a gap between materialized forms of money and money

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Leading through a Decade of Crisis—Not Bad, After All

Germany’s Leadership Demand and Followership Inclusion, 2008-2018

Valerio Alfonso Bruno and Giacomo Finzi

-decision effect. In addition, we have outlined how Germany was able to counterbalance the coordinated efforts of France, Spain, and Italy (supported by the European Commission) for the mutualization of risk and liabilities in the Euro area in the name of “European

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Investing in Early Crisis Relief or Reelection?

Comparing German Party Responses to the Euro Crisis

Alexandra Hennessy

2010, the European Financial Stability Facility ( efsf ) was created in order to provide financial assistance to euro area member states. After the cdu had promised to support Greece only once, Athens was soon unable to access capital markets. Merkel

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The Best of Times, the Worst of Times

Angela Merkel, the Grand Coalition, and “Majority Rule” in Germany

Joyce Marie Mushaben

Schelkle, “Policymaking in Hard Times: French and German Responses to Economic Crisis in the Euro Area” in Coping With Crisis: Government Reactions to the Great Recession , ed. Jonas Pontusson and Nancy Bermeo (New York, 2012): 130-162. 40 Edmund Stoiber

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Sophie Meunier

. Moreover, widening has shifted the EU’s geographical center of gravity, which was located in France until the 1995 enlargement; today it is situated in Germany. Membership in the euro area has also severely constrained the political margin of maneuver

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Beverly Crawford Ames and Armon Rezai

Ibid.; see also Eurostat “Government debt up to 89.5 percent of gdp in euro area“ Graph 1 118/2017, 20 July 2017; available at http://ec.europa.eu/eurostat/documents/2995521/8118661/2–20072017-AP-EN.pdf/83147478-c193–40e9–8a0a-b76e56a5cebc , accessed