Fixing crisis management in the Eurozone

by Stefano Micossi

Vox
September 5, 2011

This column takes stock of what we have learned from the Eurozone crisis and the policy responses. It discusses how Europe can put in place policies to reduce the chances of such a crisis repeating itself. By strengthening the Eurozone’s ability to withstand speculative attacks, it argues that policymakers would make them much less likely.

After “market hurricane” season hit financial markets this summer, it's time to take stock of Eurozone crisis management. Two things stand out:

• On all fronts Eurozone governments are moving in the right direction, albeit too often falling “behind the curve” in the timing, size, and scope of their measures (Wyplosz 2011);
• There is a broad consensus of expert opinion on what still needs to be done to stabilise financial markets durably and put the Eurozone crisis to rest once and for all.

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