Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/277442 
Year of Publication: 
2019
Citation: 
[Journal:] European Journal of Economics and Economic Policies: Intervention (EJEEP) [ISSN:] 2052-7772 [Volume:] 16 [Issue:] 2 [Year:] 2019 [Pages:] 169-175
Publisher: 
Edward Elgar Publishing, Cheltenham
Abstract: 
In response to our paper, 'ECB monetary expansions and euro area TARGET2 imbalances: a balance-of-payment-based decomposition,' Professor Andrea Terzi has criticized our approach of TARGET2 balance decomposition, by highlighting a lack of causality between balance-of-payments (BP) flows and TARGET2 net balances. Proving a strong causality link was not within the scope of our paper; while acknowledging that causal relationships are difficult to prove from data that have to fulfill an accounting identity, we still believe that useful information can be extracted from the analysis of BP accounting correspondences. From this perspective a long-term BP reconstruction for Italy and Germany is performed that confirms Terzi's claim about the rise of TARGET2 balances under specific monetary policy configurations.
Subjects: 
capital flows
payment system
financial crisis
quantitative easing
interbank lending
JEL: 
E42
E44
E52
E58
F32
F34
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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