This paper proposes a redemption fund for the euro zone countries alternative to that recently proposed by Doluca et al. (2012a) - The European Redemption Pact: an Illustrative Guide, GCEE Working Paper No. 2, February - and in coherence with a previous proposal of one of the author. In doing so, we envisage a country-specific amortization scheme in which the sovereign debts exceeding the 60%-ceiling of GDP is redeemed in 30 years. The paper shows that our redemption scheme is cheaper and less constraining than that proposed by Doluca et al. (2012a). Also, the paper shows that fiscal brakes - such as those required by the Fiscal Compact - are not necessary for the complete redemption of the Fund.

The european redemption fund: A comparison of two proposals / Parello, Carmelo Pierpaolo; Visco, Vincenzo. - In: POLITICA ECONOMICA. - ISSN 1120-9496. - STAMPA. - 28:3(2012), pp. 273-306. [10.1429/74176]

The european redemption fund: A comparison of two proposals

PARELLO, Carmelo Pierpaolo;VISCO, Vincenzo
2012

Abstract

This paper proposes a redemption fund for the euro zone countries alternative to that recently proposed by Doluca et al. (2012a) - The European Redemption Pact: an Illustrative Guide, GCEE Working Paper No. 2, February - and in coherence with a previous proposal of one of the author. In doing so, we envisage a country-specific amortization scheme in which the sovereign debts exceeding the 60%-ceiling of GDP is redeemed in 30 years. The paper shows that our redemption scheme is cheaper and less constraining than that proposed by Doluca et al. (2012a). Also, the paper shows that fiscal brakes - such as those required by the Fiscal Compact - are not necessary for the complete redemption of the Fund.
2012
european redemption fund; public debt; sovereign debt crisis; amortization schedule
01 Pubblicazione su rivista::01a Articolo in rivista
The european redemption fund: A comparison of two proposals / Parello, Carmelo Pierpaolo; Visco, Vincenzo. - In: POLITICA ECONOMICA. - ISSN 1120-9496. - STAMPA. - 28:3(2012), pp. 273-306. [10.1429/74176]
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11573/516264
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