Self-fulfilling crises in the Eurozone: An empirical test

Grauwe, Paul De; Ji, Yuemei

doi:10.1016/j.jimonfin.2012.11.003

Cited by 474 publications

(97 citation statements)

References 13 publications

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“…Thus, the multiple-equilibria theory does not preclude increased sensitivity to fundamentals such as fiscal space and public debt ratios in the run-up to the Eurozone debt crisis but rather it contends that they are not the whole story (Aizenman et al, 2013;Grauwe and Ji, 2013). It is well known that peripheral Eurozone countries suffered dramatic rises in their CDS spreads (during the pre-OMT period) compared with non-euro European countries with similar fundamentals; clearly, this leaves a role for self-fulfilling dynamics in the absence of a lender-of-last-resort.…”

Section: Literature Reviewmentioning

confidence: 99%

ECB policy and Eurozone fragility: Was De Grauwe right?

Saka

Fuertes

Kalotychou

2015

Journal of International Money and Finance

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Section: Literature Reviewmentioning

confidence: 99%

ECB policy and Eurozone fragility: Was De Grauwe right?

Saka

Fuertes

Kalotychou

2015

Journal of International Money and Finance

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“…7 Following the literature on Eurozone, Luxemburg is excluded from this analysis for its peculiar features. Among others see de Grauwe and Ji (2013).…”

Section: Introductionmentioning

confidence: 99%

Trust in Institutions and Income Inequality in the Eurozone: The Role of the Crisis

Bonasia¹,

Canale²,

Liotti³

et al. 2016

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income distribution, together with standard economic indicators such as unemployment and inflation, in the consolidation of supranational institutions. The empirical analysis also controls for financial market shocks, including domestic bond yields and stock market returns. The additional contribution is to analyze whether the sensitiveness of trust has been strengthened during the recent crisis, associating binary dummies to explanatory variables. The main conclusions can be summarized as follows: a) income inequality negatively affects trust in the EC and the EP in normal times; in crisis times, this relation is strengthened and extended to the ECB for one of the two indexes of trust considered; b) inflation and unemployment significantly affect trust in all European

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“…DeGrauwe and Ji (2012) andAizenman et al (2013) have considered the ratio of debt-to-total tax revenues as an alternative indicator of debt sustainability.3 As discussed inBernoth and Erdogan (2012), several empirical analyses on sovereign yield differentials(Codogno et al, 2003;Favero et al, 2010) use bid-ask spreads as a direct liquidity measure. In our analysis, due to lack of data, we cannot consider the bid-ask spread as an alternative liquidity proxy.…”

mentioning

confidence: 99%