policies can protect the region better from world crises and shocks, and to which extent should it rely on a strategy of close … trade and financial integration into a world economy punctuated by shocks and crises? This paper addresses the latter …

This paper draws on the experience of emerging Europe and argues that foreign capital is an enviable development … led to a buildup of vulnerabilities and now exposes emerging Europe to prolonged uncertainty and financial deleveraging … emerging Europe pursue a policy of self-insurance. Instead, what we refer to as an acyclical fiscal policy stance could serve …