240_download.pdf (784.79 kB)
Conventional direction to unconventional measures: using quantitative easing to shape Eurozone fiscal capacity
journal contribution
posted on 2023-06-09, 14:18 authored by Olimpia Fontana, Simone VannucciniEight years after the outbreak of the crisis, the Eurozone (EZ) fiscal policy remains fragmented at the national level. This paper fills the structural gap between the monetary and fiscal dimensions of EZ economic policy by suggesting a ‘conventional’ direction to the unconventional Quantitative Easing (QE) policy of the European Central Bank (ECB). We propose an evolution for QE to tackle the shortcomings of the current ‘decentralized’ fiscal policy in the EZ. In a nutshell, we suggest a change in the composition of QE asset purchases, focusing on buying European Investment Bank (EIB) bonds that, in turn, would be used to finance real investments through the Juncker Plan programme. The rationale of our proposal is legitimised by an overview of the gloomy macroeconomic conditions of the EZ, and the situation in ongoing policies. The mechanism is described in detail, with a discussion of both its strengths and possible limitations.
History
Publication status
- Published
File Version
- Published version
Journal
Perspectives On FederalismISSN
2036-5438Publisher
De Gruyter OpenExternal DOI
Issue
2Volume
8Page range
124-EArticle number
EDepartment affiliated with
- SPRU - Science Policy Research Unit Publications
Full text available
- Yes
Peer reviewed?
- Yes
Legacy Posted Date
2018-07-31First Open Access (FOA) Date
2018-07-31First Compliant Deposit (FCD) Date
2018-07-30Usage metrics
Categories
No categories selectedKeywords
Licence
Exports
RefWorks
BibTeX
Ref. manager
Endnote
DataCite
NLM
DC