Bulletin n. 1/2012
June 2012
CONTENTS
  • Section A) The theory and practise of the federal states and multi-level systems of government
  • Section B) Global governance and international organizations
  • Section C) Regional integration processes
  • Section D) Federalism as a political idea
    • André Sapir
    Europe after the crisis: less or more role for nation states in money and finance?
    in Oxford Review of Economic Policy , volume 27 n.4 ,  2012 ,  608-619
    With the completion of the single European market and the full liberalization of capital markets two separate trilemmas emerged in the early 1990s: a monetary trilemma between free capital movements, fixed exchange rates, and national monetary autonomy; and a financial trilemma between free capital movements, financial stability, and national financial supervision autonomy. The paper argues that although these two trilemmas stem from the same root cause, financial integration, the financial trilemma is particularly acute for countries that have chosen to resolve the monetary trilemma by entering into a monetary union. The lesson from the recent crisis is that eurozone countries need to replace their national financial supervision institutions by supranational institutions capable of managing and resolving financial crises. This will require pooling together some of their fiscal sovereignty.
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