We analyze the feedback mechanisms between economic downturns and financial stress for several euro area countries. Our study employs newly constructed financial condition indices that incorporate banking variables extensively. We apply a non-linear Vector Smooth Transition Autoregressive...

We analyze the feedback mechanisms between economic downturns and financial stress for several euro area countries. Our study employs newly constructed financial condition indices that incorporate banking variables extensively. We apply a non-linear Vector Smooth Transition Autoregressive...

We analyze the feedback mechanisms between economic downturns and financial stress for euro area countries. Our study employs newly constructed financial condition indices that incorporate extensively banking variables. We apply a nonlinear Vector Smooth Transition Autoregressive (VSTAR) model...

This paper discusses the interaction of fiscal and monetary policy in the euro area. Given the existence of a monetary union, but absence of a federal fiscal union, many observers suggest a fiscal union as the next step of euro area constitutional reform. Though further fiscal capacity has a...

This book pulls together papers presented at a conference in honour of the 1981 Nobel Prize Winner for Economic Science, the late James Tobin. Among the contributors are Olivier Blanchard, Edmund Phelps, Charles Goodhart and Marco Buti. One of the main aims of the conference was to discuss what...

Monetary responses to financial stress have recently become an important issue in macroeconomic and policy discussions in the USA as well as in the EU. In this paper, the authors study two regimes of monetary responses. While the fundamentals of an economy are assumed to have a long-run...

The globalization process leads to increasing synchronization of business cycle among different countries. As a consequence, many policy makers and Central Banks are afraid of vulnerabilities of their country arising from external risk drivers. In this paper we develop a multi-regime global VAR...