A Less Punishing, More Forgiving Approach to the Debt Crisis in the Eurozone

CEPS Policy Brief No. 230

5 Pages Posted: 10 Feb 2011

See all articles by Paul De Grauwe

Paul De Grauwe

London School of Economics & Political Science (LSE); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Centre for Economic Policy Research (CEPR)

Date Written: January 28, 2011

Abstract

The debt crisis that hit the eurozone last year forced European leaders to develop new solutions to deal with the crisis. In this CEPS Policy Brief, Paul De Grauwe asserts that these solutions have been misguided by the idea that sanctions should be imposed everywhere in the system. He argues that too much emphasis was put on designing punishment mechanisms to deal with the crisis and to prevent future ones and that a greater role should be given to forgiveness.

Keywords: debt, crisis, eurozone, European, leaders, new, solutions, sanctions, system, mechanisms

Suggested Citation

De Grauwe, Paul, A Less Punishing, More Forgiving Approach to the Debt Crisis in the Eurozone (January 28, 2011). CEPS Policy Brief No. 230. Available at SSRN: https://ssrn.com/abstract=1756813

Paul De Grauwe (Contact Author)

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Poschinger Str. 5
Munich, DE-81679
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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