We present and discuss current research and economic policy related topics in International Economics. This quarter about:

What will happen if the euro collapses? For many people, the answer is unmitigated disaster. But this column argues that to identify the euro, the EU, and Europe as one, as many politicians like to do, is totally misleading. A possible demise of the euro and the EU can be seen as a chance for the evolution of a better future Europe.

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Policy reactions to the Eurozone crisis are seen by many as short-sighted, incoherent, and driven by political expediency. This column disagrees. What we are seeing is a game of chicken among the key political and economic powers in Europe. As the crash looms ever closer, the right deals will be struck and Europe will emerge stronger and with its currency intact.

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Throughout the European debt soap opera, Europe’s leaders have expressed their willingness to “do whatever it takes” to restore stability and save the euro. This column argues that, too often, policymakers have in fact been “doing whatever it takes” to serve the banks.

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Is it time for Eurobonds? This column argues that Eurobonds have always been the right solution. Every successful union throughout history has needed to create a proper financial instrument of sovereign debt – and the Eurozone is no different.

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Paul De Grauwe talks to Viv Davies about the Eurozone crisis and the Brussels summit. De Grauwe suggests that the fiscal compact is incomplete and fails to address the problem of imbalances between the north and south in the Eurozone. He maintains that the ECB needs to act decisively and questions why its moral hazard considerations should not apply equally to both banks and sovereigns. They also discuss the idea of a sovereign-debt guarantee fund. The interview was recorded on 15 December 2011.

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EU leaders decided last week to boost the International Monetary Fund's firepower with an additional €200 billion, but poorer East European countries are wrangling over their contributions. The EurActiv network contributed to this article.

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Als ein Hilfsmittel in der Schuldenkrise haben die Politiker des EU-Gipfels verabredet, Gelder des IWF aufzustocken. Zahlen sollen die Notenbanken. Doch der Chef der US-Notenbank Fed hält davon nicht viel. 

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The euro crisis continues to deepen, as European leaders continue with their ‘too little too late’ policy reforms. This column argues that fixing the Eurozone problems requires a strong direction of fiscal and banking policy, but that this in turn requires deeper political integration including an elected president of the European Commission and a two-chamber parliament representing EU citizens and EU member states.

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Financial markets gave the thumbs down on Monday (12 December) to a landmark EU deal to deepen economic integration, pushing European stocks and the euro lower as investors judged its debt crisis would continue to worsen.

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EU leaders gathered in Brussels agreed on a new treaty to tighten fiscal discipline in the eurozone and address the bloc's debt problems. The treaty, an intergovernmental agreement outside the EU legal framework, will be drafted by March 2012 and opened to ratification by nations outside the 17-member eurozone.

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Die wichtigsten Zentralbanken der Welt haben den Banken den Zugang zum Dollar verbilligt. Sie sorgen sich wegen der stockenden Bargeldversorgung und befürchten deshalb eine Kreditklemme. Doch es gibt noch ein ganz anderes Problem.

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Trotz aller Beschwichtigungsversuche der Politik erwarten Firmen das Schlimmste - den Zerfall der Währungsunion. Er hätte dramatische Folgen für den Handel und das Schuldenmanagement der Unternehmen.

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Die anhaltende Krise in Europa offenbart: Die Europäische Währungsunion (EWU) ist kein optimaler Währungsraum. Die Heterogenität der Mitgliedsländer zeigte sich in den letzten Jahren u.a. in den Lohnentwicklungen und Leistungsbilanzen. Lohnzurückhaltungen in Deutschland führten über die verbesserte Wettbewerbsfähigkeit zu jährlich steigenden Nettoexporten. Die dazu spiegelbildlichen Nettokapitalexporte finanzierten die deutschen Importe in den europäischen Südländern. Der für alle EWU-Länder einheitliche Politikzins verstärkte die realwirtschaftlichen Divergenzen innerhalb des Euroraumes.

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Changes in the Italian government are driven by the country’s dire debt situation. This column, which updates a 31 October column that illustrated the unsustainability of Italian debt, argues that Berlusconi’s departure is necessary but far from sufficient. Drastic, but evenly distributed measures of consolidation and reform are necessary.

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Civil wars are devastating to a country’s development perspectives. What’s more, they often spread across borders. But this column argues that only ethnic civil wars pose a significant threat to neighbouring countries’ stability. Countries with ethnic links to a neighbouring ethnic conflict see their chances of experiencing civil conflict increase by six percentage points.

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What if there are democratic elections and the people choose a regime that violates the principles of Western human rights? What happens if, after tremendous Western effort to force democratic elections, the electorate chooses to reject Western values and pursue a very different direction? George Friedman, leading expert at Stratfor, the US intelligence consulting firm, offers a view on recent development in Egypt.

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European Union leaders yesterday (20 October) hailed reports of Muammar Gaddafi's death, saying it marked "the end of an era of despotism and repression". Up to €85 million is available for reconstruction and stabilisation needs, the European Commission indicated.

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