Quotation Breuss, Fritz. 2016. The Crisis in Retrospect: Causes, Effects and Policy Responses. In: Routledge Handbook of the Economics of European Integration, Hrsg. Harald Badinger and Volker Nitsch, 331-350. London and New York: Routledge.




The Euro area has been hit by two crises. The first, the global financial crisis (GFC) had external (U.S.) origin and has caused the Great Recession with large drops in GDP around the industrial world. The second, the Euro crisis was homemade. It is the result of systemic failures of EMU's policy design. Due to the economic heterogeneity of the Euro area the shocks were felt more severely in the peripheral Member States than in the core leading to an economic and political split of the Euro zone. As a consequence the political architecture of EMU was reformed step by step in order to fight the trinity of crisis: first, the fiscal policy coordination was strengthened by reforming the Stability and Growth Pact and additional agreements (Fiscal Compact); second, the macroeconomic imbalances are now monitored by a new procedure; third, to stabilize the financial (banking) sector many surveillance institutions have been installed and finally the European Banking Union should help to monitor and resolute banks in a more systematic way as before the crisis, switching from "bail-out" to "bail-in" and hence breaking the vicious circle of bank failure and public debt accumulation.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Chapter in edited volume
Language English
Title The Crisis in Retrospect: Causes, Effects and Policy Responses
Title of whole publication Routledge Handbook of the Economics of European Integration
Editor Harald Badinger and Volker Nitsch
Page from 331
Page to 350
Location London and New York
Publisher Routledge
Year 2016
URL https://www.routledge.com/products/9780415747707
ISBN 978-0-415-74770-7


Breuss, Fritz (Details)
Department of Economics (Badinger) (Details)
Europainstitut (Badinger) (Former organization)
Research areas (Ă–STAT Classification 'Statistik Austria')
5115 European integration (Details)
5300 Economics (Details)
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