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"Despite the efforts of policy makers to tackle recessions as they happen, there is ample evidence that major economic downturns produce lasting negative effects on real GDP, pointing to the existence of "economic scarring". This paper takes a fresh look at economic scarring in 26 OECD countries, including 14 EU member states, since 1970 and examines the role played by fiscal policy in limiting these impacts. It finds that higher current expenditure does not mitigate the lasting impact of major economic downturns on real GDP. By contrast, more government investment could help to do so, but this is generally less favoured as a policy response. As a result, scarring effects are significant, confronting governments with higher debt levels, which in turn weigh on the room for manoeuvre in subsequent downturns. In sum, fiscal policy makers face two difficulties in the event of a major economic downturn: adopting the right type of fiscal expansion, and finding the right time to pivot from short-term stabilisation to fiscal consolidation, while protecting investment".

Economics. --- Great courses (Compact disc).

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"Financial integration, broadly defined as the intensity of cross-border linkages between financial markets, has the potential to channel capital to where it is most productive, bringing many benefits. However, some financial integration is cyclical, increasing economic upswings and declining during down-turns. Of more long-term benefit is financial integration driven by structural factors such as the reductions in exchange rate risk and the increased regulatory or supervisory convergence associated with the establishment of a currency union, such as Europe's Economic and Monetary Union. This paper presents a new indicator of de facto financial integration in the European Union. Analysing this indicator alongside different financial and macroeconomic variables makes it possible to separate the impact of cyclical boom-bust shocks from the influence structural factors. It shows that increasing structural financial integration tends to improve risk absorption and reduce income disparities among European countries. However, it also suggests that most of the movements in the indicator reflect business cycle dynamics, rather than structural integration. These results highlight the need to develop further policies to foster structural financial integration in the EU".

Economics. --- Great courses (Compact disc).

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

"Financial integration, broadly defined as the intensity of cross-border linkages between financial markets, has the potential to channel capital to where it is most productive, bringing many benefits. However, some financial integration is cyclical, increasing economic upswings and declining during down-turns. Of more long-term benefit is financial integration driven by structural factors such as the reductions in exchange rate risk and the increased regulatory or supervisory convergence associated with the establishment of a currency union, such as Europe's Economic and Monetary Union. This paper presents a new indicator of de facto financial integration in the European Union. Analysing this indicator alongside different financial and macroeconomic variables makes it possible to separate the impact of cyclical boom-bust shocks from the influence structural factors. It shows that increasing structural financial integration tends to improve risk absorption and reduce income disparities among European countries. However, it also suggests that most of the movements in the indicator reflect business cycle dynamics, rather than structural integration. These results highlight the need to develop further policies to foster structural financial integration in the EU".

Economics. --- Great courses (Compact disc).

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

"Financial integration, broadly defined as the intensity of cross-border linkages between financial markets, has the potential to channel capital to where it is most productive, bringing many benefits. However, some financial integration is cyclical, increasing economic upswings and declining during down-turns. Of more long-term benefit is financial integration driven by structural factors such as the reductions in exchange rate risk and the increased regulatory or supervisory convergence associated with the establishment of a currency union, such as Europe's Economic and Monetary Union. This paper presents a new indicator of de facto financial integration in the European Union. Analysing this indicator alongside different financial and macroeconomic variables makes it possible to separate the impact of cyclical boom-bust shocks from the influence structural factors. It shows that increasing structural financial integration tends to improve risk absorption and reduce income disparities among European countries. However, it also suggests that most of the movements in the indicator reflect business cycle dynamics, rather than structural integration. These results highlight the need to develop further policies to foster structural financial integration in the EU".

Economics. --- Great courses (Compact disc).

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

"Despite the efforts of policy makers to tackle recessions as they happen, there is ample evidence that major economic downturns produce lasting negative effects on real GDP, pointing to the existence of "economic scarring". This paper takes a fresh look at economic scarring in 26 OECD countries, including 14 EU member states, since 1970 and examines the role played by fiscal policy in limiting these impacts. It finds that higher current expenditure does not mitigate the lasting impact of major economic downturns on real GDP. By contrast, more government investment could help to do so, but this is generally less favoured as a policy response. As a result, scarring effects are significant, confronting governments with higher debt levels, which in turn weigh on the room for manoeuvre in subsequent downturns. In sum, fiscal policy makers face two difficulties in the event of a major economic downturn: adopting the right type of fiscal expansion, and finding the right time to pivot from short-term stabilisation to fiscal consolidation, while protecting investment".

Economics. --- Great courses (Compact disc).