Come join DS on Monday, September 26th at 6:30pm and Tuesday, September 27th at noon as we investigate the financial crisis in Europe and its implications for the developing world
What Core, What Periphery? The European Crisis and the BRICs
Monday, September 26, 6:30pm, Joukowsky Forum
“Whipping Boy or Reluctant Savior: the European Central Bank and the Euro Crisis”
Daniela Gabor, Bristol Business School, University of the West of England
Why has the central bank of the Eurozone (ECB) become so contested? Whereas in its rhetoric this institution has called for ‘sound money’ foundational principles, its crisis interventions, particularly through the purchase of periphery government debt, have been portrayed as a detrimental postponing of the inevitable fiscal corrections in debt-ridden countries in the periphery of the Eurozone. However, the ECB’s contested practices have to be understood through a new politics of austerity produced by financial innovation and new forms of financial intermediation that in effect forces central banks like the ECB to have a different relationship with financial markets. Dr. Daniela Gabor is Associate Professor at Bristol Business School, UK. She worked as a consultant for ECLAC, Dunn and Bradstreet and various development projects in Central America. Her current research focuses on the relationship between governments, central banks and financial markets during economic crises. She is the author of Central Banking and Financialization: A Romanian Account of how Eastern Europe became Subprime (Palgrave Macmillan, 2010).
“Rescuing the Euro? The BRICs as Emerging Financial Superpowers”
Cornel Ban, Postdoctoral Scholar of International Studies, Watson Institute for International Studies, and Deputy Director, Development Studies Program, Brown University.
Illusion Economics and Illusive Solutions: Revisiting Crisis Generators in Eastern Europe
Tuesday, September 27, 12:00pm, McKinney Conference Room
Was it the global economic crisis or a combination between endogenous and exogenous factors that pushed the Baltic and South-East European EU member states into severe recession? This article argues that the causes of the crisis in these peripheral regions were different from those affecting Western Europe or United States. The main claim is that the main engine of the crisis was the excessive growth of the current account deficit via a combination between the rapid liberalization of the capital account, monetary polcies that invited speculative capital inflows as well as pro-cyclical tax and income policies. While it is clear that the global financial crisis triggered these peripheral crises by drying up the foreign financial flows that funded ballooning current account deficits, it is not at all clear that the crisis would have been as dramatic in the absence of structural problems generated by these domestic policies. The article also argues, for the particular case of Romania, that the IMF-induced austerity does not work; it only replaces the illusion of private consumption – led growth with the illusion of public consumption cuts – led growth. Liviu Voinea, Ph.D., MBA, is a Senior Lecturer in EU economics at the National School for Political and Administrative Studies and an Associate Professor of international economics at the Academy of Economic Studies. He holds an MBA from Stockholm University, a Ph.D. from Academy of Economic Studies, and he worked as a post-doctoral fellow at the European Commission’s IPTS – Joint Research Center in Seville, Spain. He serves as President of the European International Business Academy (EIBA), a European organization of international business scholars. He is also a member of the board of Eximbank, the Romanian state owned export-import bank.