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The purpose of this thesis is to carry out an empirical investigation into whether membership of monetary union matter in the determination of bank net interest margin. Bank net interest margin is the difference in bank borrowing and lending rates relative to the total interest-earning assets. We operationalise this study by comparing panels of commercial banks within and outside economic and monetary unions in Europe and Sub-Saharan Africa. For our European analysis we use bank-level data from nine Euro Area countries and seven non-Euro Area economies, in a dynamic empirical model, employing Arellano and Bover (1995)/Blundell and Bond (1998) system GMM estimation method. We find that stronger competition and efficiency, as well as greater macroeconomic stability in the Euro Area reduce bank net interest margins more than in the non-Euro Area. We attribute this to the well-developed single market with a strong socio-economic cohesion underpinning rather than the economic and monetary union. We extend the same level of analysis to the Sub-Saharan Africa, where we contrast our findings in the West African Economic and Monetary Union (WAEMU) with those of twenty non-monetary union Sub-Saharan African economies. Our findings in the Sub-Saharan African context reveal a rather different scenario. While the WAEMU enjoys relatively lower net interest margins than its non-monetary union counterparts, this is attributable to the union’s ability to pursue vigorously its primary objective of maintaining price stability by maintaining lower interest rates. Unlike in the Euro Area we do not observe a reducing impact of bank competition and efficiency on bank net interest margin in the West African Economic and Monetary Union (WAEMU) as we do in the non-monetary union Sub-Saharan Africa. We find these results for the Sub-Saharan African analysis puzzling, and attribute it to the absence of a well-developed single/common market which is supposed to drive competition and efficiency with the effect of reducing net interest margins, as it obtains in the Euro Area. Our conclusion is that it is rather the presence of a well-developed single market that engenders competition and efficiency effects to reduce bank net interest margins rather than membership of a monetary union per se.

Yes / Purpose – The objective of this study is to understand the budgetary role of national legislatures in Euro Area (EA) countries and to analyse implications for fiscal discipline. Design/methodology/approach – Building on the budget institutions literature, a legislative budgetary power index for all the 19 EA countries is constructed using OECD and European Commission data as well as data generated from questionnaires to national authorities. A two-way fixed effects panel data model is then used to assess the effect of legislative budgetary power on the budget balance in the EA during 2006-15. Findings - Overall, in the EA, formal legislative powers vis-à-vis the national budgetary process are weak but there is more legislative involvement in SGP procedures and legislative budgetary organisational capacity is generally quite good. In contrast to the traditional view in the budget institutions literature, our empirical findings show that strong legislative budgetary power does not necessarily result in larger budget deficits. Research limitations/implications – Data on legislative budgeting was available from different sources and timeseries data was very limited. Practical implications – There is scope to improve democratic legitimacy of the national budgetary process in the EA, without necessarily jeopardising fiscal discipline. Originality/value – The constructed legislative budgetary power index covers all the 19 EA countries and has a broad scope covering various novel institutional characteristics. The empirical analysis contributes to the scarce literature on the impact of legislative budgeting on fiscal discipline.

Terminada a Segunda Guerra Mundial, o continente europeu encontrava-se devastado pelo conflito que havia mobilizado o maior contingente de países envolvidos numa só guerra até então. Nesse cenário, renasceria a ideia de criação de um bloco econômico alinhado aos EUA, mas, ao mesmo tempo, economicamente autônomo. Este seria construído lentamente, entre 1948 a 1989, e chegaria ao fim da década de 1980 com 12 participantes que, mais uma vez, presenciariam uma mudança continente europeu. O final da Guerra Fria e o desmonte do bloco soviético marcariam os novos rumos da integração europeia, agora livre da divisão Leste-Oeste. Ainda assim, o século XX se encerraria com boas perspectivas para os defensores de união dos países da Europa, e o desejo por numa agenda mais profunda do que a econômica e de defesa voltaria à pauta. Contudo, o início do século XXI assistiria a intervenções militares, massacres, limpezas étnicas, e guerras justificadas pelo discurso da Guerra ao Terror. Além de crises especulativas que levaram a unificação europeia a uma nova fase de busca de identidade e discurso. Adicionalmente, uma crise financeira, com origem na não-realização de investimentos em papeis de origem estadunidense, e garantidos em última instância pelo governo daquele país, alavancaria a crise de dívida pública de alguns países do subconjunto da União Europeia: a Zona do Euro. Sem liberdade para aplicar políticas fiscais, monetárias ou cambiais próprias, tais países se veriam obrigados a arcar com os custos da opção realizada por seus bancos privados, no mercado financeiro internacional. É esse o tema deste trabalho, a formação e expansão do bloco econômico europeu e a crise que atingiu o subconjunto dos países unificados monetariamente, a Zona do Euro. / After the Second World War, the European continent found itself devastated by the conflict that had mobilized the largest number of countries involved in one war so far. Such scenario would inspire and renew the wish to create a group of countries aligned with the USA, but at the same time economically autonomous. This would slowly be built between 1948 and 1989. By the end of the decade of 1980, the economic bloc counted twelve participants and, once again, the old continent would go thru another transformation. The end of the Cold War and the dismantling of the Soviet bloc would mark the new direction of European integration, now free of East-West polarities. The twentieth century would end with good prospects for the ones who advocated in favor of a more closely union of the countries of Europe, and the desire for a deeper than economic and defense calendar were put back on the agenda. However, the early twenty-first century would watch military interventions, massacres, \"ethnic cleansing\", all justified by the discourse of the \"War on Terror\". In addition, the European unification reached a new phase marked by the search for identity and discourse better related to the new international scenario. In the first decade of this new century, a financial crisis, originated in a low-performing investments in papers of American origin, and ultimately guaranteed by the government of that country, end up by levering the public debt in some countries of the European Union, more precisely, in the Eurozone. Without freedom to apply their own fiscal, monetary and exchange rate policies, such countries would be forced to bear the costs of the options held by its private banks in international financial markets. That\'s the theme of this work, the formation and expansion of European economic bloc and the crisis that hit the Eurozone in the first decade of the 21th Century.

La crise financière et ´économique a remis en cause les modalités de mise en œuvre et de fonctionnement de la politique monétaire. Avant la crise, la politique monétaire était simplement retranscrite par une règle de taux d’intérêt. Désormais, les instruments et les canaux de transmission sont devenus complexes et les effets incertains. Dans cette perspective, cette thèse propose une évaluation théorique et empirique des politiques monétaires non conventionnelles dans l’environnement hétérogène qu’est la zone euro. Le chapitre 1 analyse les effets de ces politiques sur le coût du crédit aux entreprises. Nous montrons que les effets directs ont été limités. Néanmoins, les mesures non conventionnelles ont été efficaces dans l’accompagnement de la politique de taux zéro (effets indirects). Le chapitre 2 porte sur l’impact de ces politiques sur la courbe des taux et la prime souveraine. Nous montrons que ces mesures ont permis de réduire les primes. Toutefois, leur transmission est hétérogène entre les pays et dans le temps, suivant la perception des investisseurs. Nous ´étudions au chapitre 3 les conséquences macro-économiques et financières de ces politiques. Il ressort qu’elles se transmettent à l’économie par une hausse du prix des actifs suivie d’une baisse des taux d’intérêt. De ce fait, les conditions de crédit se sont assouplies, ce qui a relancé l’activité de financement bancaire. Ces politiques ont amélioré la compétitivité, stimulé la demande et augmenté le taux d’inflation. Néanmoins, leurs effets sur l’activité et les conditions d’offre et de demande de crédit sont lents dans certains pays. Dans le chapitre 4, nous montrons avec un modèle DSGE, qu’une forte capitalisation bancaire et un secteur bancaire en bonne santé renforcent la transmission des politiques non conventionnelles conformément à ce qui avait ´été trouvé empiriquement dans la première partie de la thèse. / The financial and economic crisis has challenged the implementation and the transmission channels ofthe monetary policy. Before the crisis, monetary policy was conducted through a simple interest rate rule.Now, instruments and channels of transmission have become complex and uncertain. In this perspective, thisthesis focuses on theoretical and empirical evaluation of unconventional monetary policies in the heterogeneousenvironment that is the euro area. Chapter 1 analyses the effects of these policies on the cost of credit toenterprises. We show that the direct effects have been limited. Nevertheless, unconventional policies havebeen effective in supporting the zero interest rate policy (indirect effects). Chapter 2 focuses on the effects ofthese policies on the yield curve and the sovereign premium. We point out that these policies have reducedpremiums. Their transmission is strongly influenced by the market expectations and heterogeneous acrosscountries and over time. We discuss in Chapter 3 the macroeconomic and financial implications of thesepolicies. We show that they increased asset prices and lowered interest rates. As a result, credit conditionswere relaxed, which boosted bank lending. These policies have improved the competitiveness of the country,increased output and inflation. However, their effects on the real activity, the credit standard and the creditdemand is slow in some countries. By using a DSGE model in Chapter 4, we find that a strong bankcapitalization and a healthy banking sector enhance the transmission of unconventional policies, in accordancewith what has been found empirically in the first part of the thesis.

This thesis deals with the monetary policy of the European Central Bank. At the beginning of the work is described historical development. The next section focuses on the implementation of monetary policy, including the performance goals in the first twelve years of operation, with emphasis on the consequences of the global financial crisis. The last section summarizes the problems of the euro area financial and economic crisis of the years 2007/2008. In addition to the ECB's response to the crisis in the form of non-standard measures is decommissioned range of issues relating to fiscal policy and debt crisis euro area.

The money demand function has been regarded as a fundamental building block in macroeconomic modelling, as it represents the link between the monetary policy and rest of the economy. The extensive literature on money demand function is concerned with the existence of a stable money demand function, which ensures adequate prediction of impact of a given change in money supply on other economic variables such as, inflation, interest rates, national income, private investment and other policy variables. This thesis employs both linear and nonlinear estimation methods to investigate the relationship between money demand, GDP, inflation and interest rates for the Euro Area over the period 1980-2010. The aim of this thesis is to compare the European money demand in linear and nonlinear framework. First a vector autoregression (VAR) model has been estimated. Then a threshold cointegration model has been employed and nonlinearity properties of the money demand relationship has been investigated. In contrast to the existing empirical literature, linear VEC model can find evidence of stability, however it has some conflicting results which can be explained by the nonlinearity of the model. Empirical results of MTAR type threshold cointegration specification verifies the nonlinearity in European money demand. The adjustment coefficient of lower regime suggests faster adjustment towards long run equilibrium compared to upper regime in nonlinear model. Moreover, the nonlinear model presents better fit to economic literature than linear model for European money demand.

This thesis analyses determinants for structural reforms in the euro area. First, it is theoretically scrutinized how the common monetary policy of the European Central Bank causes a reform bias between small and large countries. Second, it is examined how private market adjustment, structural reforms and their interaction affect the intra-euro area current account balances of euro area countries. Third, it is analysed how an asymmetric foreign asset and liability distribution across the euro area affects single countries need for structural reforms of labour markets. Fourth, the impact of fiscal stabilization policy on structural reform activity will be examined.

Thesis (doctoral)--Universität Leipzig, 2007. / Includes bibliographical references.

Zugl.: Sheffield, University, Diss., 2005.