Will TARGET2-Balances be Reduced again after an End of the Crisis?

This article deals with the macro-economics of the Trans-European Automated Re- al-time Gross Settlement Express Transfer System (TARGET2). Originally, the TARGET2 was in-tended to solely function as a monetary arrangement for liquidity issues. It is shown that the TARGET2 contributes to a substantial misallocation of real resources within the Eurozone (EZ). The discussion highlights that there are no tendencies for rebalancing TARGET2-claims and liabilities, but rather a dynamic towards infinite and prolonged TARGET2-imbalances in the form of hysteresis.

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Year of publication:	2012-05-28
Authors:	Fahrholz, Christian ; Freytag, Andreas
Institutions:	Friedrich-Schiller-University Jena
Subject:	TARGET2 \| Eurosystem \| ESCB \| balance-of-payments

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Extent:	application/pdf
Series:	Global Financial Markets Working Paper Series.
Type of publication:	Book / Working Paper
Notes:	Number 30-2012
Classification:	E02 - Institutions and the Macroeconomy ; E42 - Monetary Systems; Standards; Regimes; Government and the Monetary System ; E44 - Financial Markets and the Macroeconomy ; E63 - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization ; H63 - Debt; Debt Management
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010615130