This paper explores the dominant role of politics in decisions made by euro area governments during the crisis … discussed. The domination of politics over economics has led to crisis mismanagement. The underlying cause of tension is … noncooperative manner. This has magnified the costs of the crisis and has resulted in an unbalanced and divisive incidence of the …

Motivated the European debt crisis, we construct a tractable theory of sovereign debt and structural reforms under …

useful lessons for avoiding such crises in the future. The crisis resulted from a worsening European economic environment …/or inadequate understanding of the magnitude of the crisis, delayed corrective action for 18 months until election time, making a …

-to-quality effect. Common news about the euro crisis and news about specific countries itself tend to raise the covariance of yields … between distressed countries, indicating potential crisis spill-over effects. However, we do not detect spillover effects from … Markets Programme (SMP) mitigate the negative crisis spillovers among the distressed countries and reduce the flight …

debt composition choices of the type observed during the recent sovereign debt crisis in Europe. …

ongoing crisis. Then, we offer an explanation that can account for those causes and consequences. This explanation is based on … exit from the crisis and the resumption of growth. …

respective major crisis triggers (Lehman’s collapse in the US and the 2009 admission by Papandreou, that Greece’s deficit was … those widely observed crisis triggers is similar in the EA and in the US, the behavior of their reserves is quite different …