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dc.contributor.authorSchnabl, Guntheren_US
dc.contributor.authorZemanek, Holgeren_US
dc.description.abstractIn the current debate on the reasons and implications of the Greek and Irish euro crisis, the intra-European current account imbalances have gained rising attention. Whereas Greece and Ireland struggle for austerity in private and public spending, Germany is urged to reduce its current account surplus by increasing wages to forestall a new build-up of unsustainable intra-E(M)U indebtedness. We analyse the emergence of intra-European imbalances since the year 1990 based on the theory of optimum currency areas. We show that the asymmetric shock of the German unification can be seen not only as the origin of the 1992/93 crisis of the European Monetary System, but also for the rising intra-European current account imbalances since the euro introduction and thereby the current European debt crisis. Based on this finding we argue that an increase of German spending to reduce its current account surplus is not only in the interest of German taxpayers to contain financial risk, but would also impose austerity on the rest of Europe. The resulting new wave of crisis could trigger a new round of monetary expansion in the EMU.en_US
dc.publisherCenter for Economic Studies and Ifo Institute (CESifo) Munichen_US
dc.relation.ispartofseriesCESifo working paper: Monetary Policy and International Finance 3279en_US
dc.subject.keywordmonetary unionen_US
dc.subject.keywordGerman unificationen_US
dc.subject.keywordasymmetric shocken_US
dc.subject.keywordcurrent account imbalancesen_US
dc.subject.keywordinter-temporal savingsen_US
dc.subject.keywordfinancial crisisen_US
dc.subject.keywordeuro crisisen_US
dc.subject.keywordEuropean debt crisisen_US
dc.subject.keywordtheory of optimum currency areasen_US
dc.subject.stwEuropäische Wirtschafts- und Währungsunionen_US
dc.subject.stwOptimaler Währungsraumen_US
dc.subject.stwNationale Einheiten_US
dc.titleInter-temporal savings, current account dynamics and asymmetric shocks in a heterogeneous European Monetary Unionen_US
dc.typeWorking Paperen_US
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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