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Posted on 20-10-2017

The next Multiannual Financial Framework (MFF) and its duration

16-10-2017

The study focuses on the characteristic features of the MFF and on how to implement the EU budget more effectively in the future. The analysis concentrates on 3 possible options in connection with the duration of the next MFF. The main advantages and disadvantages of 5-year, 7-year and 10(5+5)-year scenarios are examined from the point of view of predictability (stability) and responsiveness (flexibility), and, in addition, from the perspective of political cycles and implementation time tables.

The study focuses on the characteristic features of the MFF and on how to implement the EU budget more effectively in the future. The analysis concentrates on 3 possible options in connection with the duration of the next MFF. The main advantages and disadvantages of 5-year, 7-year and 10(5+5)-year scenarios are examined from the point of view of predictability (stability) and responsiveness (flexibility), and, in addition, from the perspective of political cycles and implementation time tables.

External author

Dr. Ákos Kengyel

What conclusions can be drawn from the EBA 2016 Market Risk Benchmarking Exercise?

19-10-2017

The EBA benchmarking exercise shows strong disagreement between different banks both about the value and about the risk of hypothetical test portfolios. If the results of the EBA benchmarking study are correct, and as far as the test portfolio instruments are representative, the internal market risk models currently used by European banks would strongly violate the Level Playing Field Principle (“If different banks hold the same portfolio, they should be required to hold the same amount of regulatory ...

The EBA benchmarking exercise shows strong disagreement between different banks both about the value and about the risk of hypothetical test portfolios. If the results of the EBA benchmarking study are correct, and as far as the test portfolio instruments are representative, the internal market risk models currently used by European banks would strongly violate the Level Playing Field Principle (“If different banks hold the same portfolio, they should be required to hold the same amount of regulatory capital.”). In this analysis, I present the EBA results in a non-technical language, and assess the robustness and validity of the study itself, highlighting problematic issues in EBA’s methodological approach. Furthermore, I discuss which follow-up actions ECON Members might consider.

External author

T. Breuer

Posted on 06-10-2017

Research of the Policy Department for Citizens’ Rights and Constitutional Affairs and the EPRS in the Fields of Responsibilities of the Special Committee on Terrorism

06-10-2017

This paper provides a detailed analysis of the responsibilities of the Special Committee on Terrorism and the corresponding available and upcoming research of the Policy Department for Citizens' Rights and Constitutional Affairs and the EPRS.

This paper provides a detailed analysis of the responsibilities of the Special Committee on Terrorism and the corresponding available and upcoming research of the Policy Department for Citizens' Rights and Constitutional Affairs and the EPRS.

Posted on 03-10-2017

Gender Equality policies in Malta with a specific focus on Violence against Women

16-01-2017

This In-Depth analysis is prepared for the FEMM Committee Delegation Members to Malta on 3-4 February 2017.

This In-Depth analysis is prepared for the FEMM Committee Delegation Members to Malta on 3-4 February 2017.

Posted on 29-09-2017

The Social and Employment Situation in Spain

15-08-2017

This document describes the situation of employment policies in Spain and assesses their recent effects on the labour market in the context of the employment upturn that started in 2013. The impact of unemployment on poverty and the population at risk of social exclusion and the population in a situation of dysfunctional mobility are analysed, highlighting the changes caused in his composition by the impact of the economic crisis.

This document describes the situation of employment policies in Spain and assesses their recent effects on the labour market in the context of the employment upturn that started in 2013. The impact of unemployment on poverty and the population at risk of social exclusion and the population in a situation of dysfunctional mobility are analysed, highlighting the changes caused in his composition by the impact of the economic crisis.

External author

Oriaol HOMS

Posted on 27-09-2017

The Single Monetary Policy and Decentralisation: An Assessment

15-09-2017

Monetary policy in the Eurosystem is ‘one and indivisible’, an exclusive EU competence. However, there remains an operational distinction: while the decision-making stage is centralized at the ECB, the implementation stage is decentralized at the level of the National Central Banks (NCBs). In response to the crisis the Eurosystem operational framework has undergone major changes with the introduction of non-standard monetary policy instruments as well as the recourse to emergency liquidity assistance ...

Monetary policy in the Eurosystem is ‘one and indivisible’, an exclusive EU competence. However, there remains an operational distinction: while the decision-making stage is centralized at the ECB, the implementation stage is decentralized at the level of the National Central Banks (NCBs). In response to the crisis the Eurosystem operational framework has undergone major changes with the introduction of non-standard monetary policy instruments as well as the recourse to emergency liquidity assistance or lender of last resort (LOLR). Against this background, we assess the balance between centralization and decentralisation, considering in particular the LOLR function both as regards market liquidity assistance (ECB competence) and individual liquidity assistance (national competence, NCBs). We discuss measures which may improve the simplicity, transparency and cost efficiency of the existing operational framework and facilitate the effective exercise of accountability by the European Parliament. We further recommend that the role of the ECB in the provision individual liquidity assistance be reconsidered in the light of Article 18 ESCB Statute (European System of Central Banks) and the advent of banking union. We also argue that data on Emergency Liquidity Assistance (ELA) should be reported, albeit with a lag, and that all banks provide a disclosure policy.

External author

Mark HALLERBERG, Rosa M. LASTRA

Posted on 26-09-2017

The single monetary policy and its decentralised implementation: An assessment

15-09-2017

While the Eurosystem has considerably improved its operational transparency in the last few years, it is still lagging the Federal Reserve System (Fed), especially in terms of the information it provides on operating costs and staff numbers, for which it provides very scarce data. In addition, the available information is scattered throughout different publications, rather than being presented in a user-friendly fashion. Compared to the Fed, the Eurosystem seems to have higher staff numbers and operational ...

While the Eurosystem has considerably improved its operational transparency in the last few years, it is still lagging the Federal Reserve System (Fed), especially in terms of the information it provides on operating costs and staff numbers, for which it provides very scarce data. In addition, the available information is scattered throughout different publications, rather than being presented in a user-friendly fashion. Compared to the Fed, the Eurosystem seems to have higher staff numbers and operational costs for similar tasks. Also because of the Treaty requirement to implement monetary policy in a decentralised way, the Eurosystem’s implementation of monetary policy is fairly complex.

External author

Francesco PAPADIA, Alexander ROTH (Bruegel)

The single monetary policy and its decentralised implementation: An assessment

15-09-2017

The statutes of the European Central Bank (ECB) stipulate that it should have recourse to national central banks (NCBs) to carry out monetary policy operations. Such a structure would not be a problem if these operations were all identical across member states and if the resulting profits and losses were shared. But this is not the case today. In this sense, the euro area no longer has a ‘single’ monetary policy. There is little one can do about this situation, except to wait until the government ...

The statutes of the European Central Bank (ECB) stipulate that it should have recourse to national central banks (NCBs) to carry out monetary policy operations. Such a structure would not be a problem if these operations were all identical across member states and if the resulting profits and losses were shared. But this is not the case today. In this sense, the euro area no longer has a ‘single’ monetary policy. There is little one can do about this situation, except to wait until the government purchase programme ends and is then reversed. However, two steps could be undertaken already now: i) the granting of emergency liquidity assistance should be shifted to the ECB, and ii) the NCBs should be forbidden to undertake any financial operation that is not a direct consequence of their execution of the ECB’s monetary policy decisions. The existing stocks of assets (and liabilities), the so-called ANFA (Agreement on Net Financial Assets) holdings, which are not related to monetary policy, should be transferred to either national finance ministries or national special purpose vehicles.

External author

Daniel GROS (CEPS)

The corporate sector purchase programme (CSPP): Effectiveness and challenges ahead

15-09-2017

In March 2016 the ECB announced the launching of the Corporate Sector Purchase Programme (CSPP), enabling the direct purchase by the ECB of investment grade euro-denominated bonds issued by non-bank corporations based in the Euro area in the primary and secondary markets. Although a new monetary policy instrument in the Eurosystem, the CSPP is not a global innovation, since other central banks have resorted to similar initiatives since the onset of the Great Recession in 2008. While undoubtedly contributing ...

In March 2016 the ECB announced the launching of the Corporate Sector Purchase Programme (CSPP), enabling the direct purchase by the ECB of investment grade euro-denominated bonds issued by non-bank corporations based in the Euro area in the primary and secondary markets. Although a new monetary policy instrument in the Eurosystem, the CSPP is not a global innovation, since other central banks have resorted to similar initiatives since the onset of the Great Recession in 2008. While undoubtedly contributing to the smooth functioning of the transmission mechanism for monetary policy, CSPP also present challenges, like other aspects of the ECB’s Asset Purchase Programme. This note discusses the effectiveness of the programme and some options available to the ECB.

External author

Corrado MACCHIARELLI, Mara MONTI, Andrea VEDOLIN

Policy decentralization at the ECB

15-09-2017

The decentralized implementation of ECB policy to national central banks has raised concerns about the transparency of policy operations. We argue that these concerns are misplaced: first, the sharp monetary easing under the assets purchase programme is actually allocated according to the capital key of the ECB; second, this allocation may feed divergences between the different Eurozone member states. Though the latter point is not part of the ECB mandate, we argue that another policy may well be ...

The decentralized implementation of ECB policy to national central banks has raised concerns about the transparency of policy operations. We argue that these concerns are misplaced: first, the sharp monetary easing under the assets purchase programme is actually allocated according to the capital key of the ECB; second, this allocation may feed divergences between the different Eurozone member states. Though the latter point is not part of the ECB mandate, we argue that another policy may well be possible.

External author

Christophe BLOT, Jérôme CREEL (Sciences Po, OFCE)

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