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International Finance International Economic Integration and Financial Imbalances in the European Monetary Union 3 October, 2013 - London, United Kingdom
At a special presentation in London on 3 October, 2013, Giuseppe Bertola, Professor of Economics at EDHEC Business School and core faculty member of the EDHEC-Risk Institute PhD in Finance, will be drawing on his recent research for the European Commission as well as ongoing work to shed new light on the sources and implications of international financial imbalances in the European Monetary Union.

Financial imbalances are a natural consequence of international economic integration, not only because savings from capital-rich countries fund investment in capital-poor countries, but also because consumption and savings patterns anticipate income and productivity convergence. In the euro area, financial market integration facilitated accumulation of international imbalances but does not appear to have resulted in the expected convergence. In fact, Professor Bertola’s study of empirical patterns before and after the recent euro area debt crisis suggests that the development of a common financial market appears to have created expectations of productivity convergence at the same time as it made it easier for uncoordinated productivity-relevant policies to diverge. The resulting crisis has cast doubt on the sustainability not only of imbalances, but also of the the European integration process.

A robust and coherent process would not only foster institutional and productivity convergence but also require supranational implementation of the behavioural constraints and contingent redistribution schemes that traditionally operate at the country level, and which have been weakened by uncoordinated policy competition. Formidable political and technical problems would need to be solved on the way. Such an uphill battle would now need to be fought in a context where revised perceptions of integration’s promises and pitfalls may trigger a breakdown of the integration process itself.

  • 5:45pm

  • 6:00pm
    Presentation: International Economic Integration and Financial Imbalances in the European Monetary Unions
    Giuseppe Bertola, Professor of Economics, EDHEC Business School and Member, EDHEC-Risk Institute
    • Understanding the impact of integration on production, consumption and savings
    • An empirical look at imbalance, convergence and inequality patterns before the crisis
    • The role of expectations and imbalances in the crisis and a look at shock absorbers
    • Policy implications and recommendations

  • 7:30pm
    Question & Answer Session

  • 8.00pm
About the Speaker

Professor Bertola’s research focuses on labour and financial market structures and institutions in an international comparative perspective. He has published widely in leading economics journals such as American Economic Review, European Economic Review, International Economic Review, Journal of Money, Credit and Banking, and Review of Economic Studies. He serves as Labour Economics Programme Director of the Centre for Economic Policy Research and advises various international organisations. Prior to joining EDHEC Business School, he held faculty positions with the University of Turin, the European University Institute, and Princeton University. He received his PhD in Economics from the Massachusetts Institute of Technology.
Event Details
  When   Between 03/10/2013 05:30 PM and 03/10/2013 08:30 PM
Where   EDHEC Risk Institute—Europe, 10 Fleet Place, Ludgate, London EC4M 7RB, United Kingdom
Contact Details
  Name   Brigitte Bogaerts
E-mail   brigitte.bogaerts@edhec.edu