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SUMMARY:St Catharine's Political Economy Seminar Series - Speaker: Paul De
  Grauwe   - Speaker to be confirmed
DTSTART:20160504T170000Z
DTEND:20160504T183000Z
UID:TALK63292@talks.cam.ac.uk
CONTACT:Philippa Millerchip
DESCRIPTION:Talk Title: ‘Flexibility versus Stability. A Difficult Trade
 off in the Euro Area’\n\nSpeaker\nPaul De Grauwe is John Paulson Profess
 or at the London School of Economics. He was a member of the Belgian parli
 ament from 1991 to 2003. He is honorary doctor of the University of Sankt 
 Gallen (Switzerland)\, the University of Turku (Finland)\, the University 
 of Genoa and the University of Valencia. He was a visiting professor at va
 rious\nuniversities: Paris\, Amsterdam\, Berlin\, Kiel\, Milan\, Pennsylva
 nia and Michigan. He obtained his Ph.D from the Johns Hopkins University i
 n 1974. He is a research fellow at the Centre for European Policy Studies 
 in Brussels and area director ‘Macro\, Money and Finance’ at CESifo in
  Munich. His research interests are in the economics of monetary unions an
 d behavioural macroeconomics. His book publications include ‘The Economi
 cs of Monetary Union’\, Oxford University Press\, 10th Edition\, 2014\, 
 and ‘Lectures on Behavioral Macroeconomics’\, Princeton University Pre
 ss\, 2012.\n\nTalk Overview:\nPaul De Grauwe will provide empirical eviden
 ce that the more important shocks in the Euro Area have been the result of
  booms and busts driven by waves of optimism and pessimism. These business
  cycle movements have been relatively well-synchronized. What was not sync
 hronized was the amplitude of these business cycle movements\, where some 
 countries experienced much stronger variations in the business cycles than
  others. In principle these business cycle movements could be stabilized a
 t the national level without the need of a budgetary union. \nHowever\, as
  the intensity of these movements is so different\, countries experiencing
  the deepest recession are likely to be hit by ‘sudden stops’\, that f
 orce them to switch off the automatic stabilizers in the budget\, preventi
 ng them to do any stabilization. Paul De Grauwe will argue that the only w
 ay to deal with these business cycle movements whose amplitude is dis-sync
 hronized\, is by introducing a budgetary union. A budgetary union eliminat
 es the destabilizing flows of liquidity between countries during the reces
 sion\, and the common budgetary authority can allow the automatic stabiliz
 ers in the common budget to perform their role in smoothing the business c
 ycle. The new governance of the Euro Area is based on imposing structural 
 reforms. This new governance\, however\, does not solve the stabilization 
 problem that arises from the fact that the largest part of the asymmetric 
 shocks in the Euro Area finds its origin in booms and busts in economic ac
 tivity.\n
LOCATION:The Ramsden Room\, St Catharine's College
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