ZEW policy brief No. 12-01 // 2012

FIRE for the Euro

The aggravating turbulences in the market for euro government bonds have so far precluded any recovery from the debt crisis. The key problem is that structural reforms and consolidation measures have long impact lags and are not able to stop an acute self-fulfilling crisis of confidence. In the discussion on possible solutions for this dilemma, Eurobonds and their numerous variants are prominent.

Heinemann, Friedrich (2012), FIRE for the Euro, A Strategy for Stabilizing Government Bond Markets, ZEW policy brief No. 12-01, Mannheim