European Banking Union and Current Account Imbalances

Información del proyecto

EBUCAI

Identificador del acuerdo de subvención: 656240

DOI

10.3030/656240

Proyecto finalizado el 13 Febrero 2016

Fecha de la firma de la CE 2 Marzo 2015

Fecha de inicio 1 Febrero 2016

Fecha de finalización 31 Enero 2018

Financiado con arreglo a

• EXCELLENT SCIENCE - Marie Skłodowska-Curie Actions

Coste total

€ 166 156,80

Aportación de la UE

€ 166 156,80

Coordinado por

INSTITUT FUR HOHERE STUDIEN - INSTITUTE FOR ADVANCED STUDIES
Austria

Objetivo

Financial liberalization and cross-border banking underpin a striking global trend: while creditor countries had net financial claims on debtors of 20% of GDP in 1980, by 2010 this had risen to 70%. In accounting terms, such international wealth re-distribution materializes via current account (CA) surpluses by creditors and deficits by debtors. Hence the interest in what drives such CA imbalances, their desirability, and sustainability. The recent Eurozone crisis brought further attention to the issue: Greece, Ireland, Portugal, and Spain all had unprecedented CA deficits in the run up to the crisis, and studies indicate that such high deficits helped trigger it.

The MAIN OBJECTIVE of this project is to deepen understanding of the links between CA imbalances, cross-border banking and credit. Much of CA flows consist of purchase/sale of debt contracts between residents and foreigners, and since up to two thirds go through banks, the accounting link is clear. Unclear is the behavioral link: What motivates such flows and makes them very risky at times? This project’s novelty is to build a model of this behavioral link, focusing on the Eurozone.

This main objective WILL BE ACHIEVED BY:
- A new general equilibrium model featuring international risk-taking banks with potential externalities on the economy and which can amplify CA imbalances
- A new database on banking indicators and macro-determinants of CAs
- Model estimates using O2 and state-of-the-art empirical methods
- Assessment of risk thresholds and welfare of regulatory policies
- Scenarios for intra-Eurozone imbalances under the EU banking union

This research is HIGHLY RELEVANT TO THE WORK PROGRAM because unexplained CAs expose countries to undetected risks, and studies on Eurozone CAs do not model bank behavior thus overlooking a main component of imbalances. This research is timely because growing cross-border banking affects imbalances and understanding such links is key to EU banking union policies.

Ámbito científico (EuroSciVoc)

• ciencias naturales › informática y ciencias de la información › base de datos

Palabras clave

• Current account imbalances
• financial sector linkages
• banking union

Programa(s)

• H2020-EU.1.3. - EXCELLENT SCIENCE - Marie Skłodowska-Curie Actions PROGRAMA PRINCIPAL
  
• H2020-EU.1.3.2. - Nurturing excellence by means of cross-border and cross-sector mobility
  

Tema(s)

• MSCA-IF-2014-EF - Marie Skłodowska-Curie Individual Fellowships (IF-EF)
  

Régimen de financiación

MSCA-IF - Marie Skłodowska-Curie Individual Fellowships (IF)

Convocatoria de propuestas

H2020-MSCA-IF-2014

Coordinador

INSTITUT FUR HOHERE STUDIEN - INSTITUTE FOR ADVANCED STUDIES

• Aportación neta de la UEn: € 166 156,80
• Dirección: JOSEFSTADTER STRASSE 39 ; 1080 Wien ; Austria
• Región: Ostösterreich › Wien › Wien
• Tipo de actividad: Higher or Secondary Education Establishments
• Coste total: € 166 156,80