“Quo Vadis Europe? Banks, Sovereigns, and the Crisis”

 

Martin Hellwig will give the Max Weber Lecture in November  titled “Quo Vadis Europe? Banks, Sovereigns, and the Crisis”. Martin Hellwig was appointed Director, Max Planck Institute for Research on Collective Goods, Bonn, and Professor of Economics, University of Bonn (Courtesy Appointment) in 2004. He holds a diploma in economics from the University of Heidelberg (1970) and a doctorate in economics from the Massachusetts Institute of Technology (1973). His research interests involve public economics, network industries and competition policy, financial markets and institutions, corporate governance, foundations of monetary theory and macroeconomics and anything else that looks intriguing.

The lecture starts by asking why Europe has found it so difficult to deal with the so-called “euro crisis”. The analysis focuses on the complexity created by having a multiplicity of different types of sovereign debt and banking crises at the same time; it also highlights the failure of available governance mechanisms and the lack of workable political discourse at national and supranational levels. Whereas the origins of the crisis can be found in the weakening of various governance mechanisms through the introduction of the European Monetary Union, the crisis itself has contributed to a further weakening of governance by making the ECB a hostage to the weakness of banking systems. The second half of the lecture focuses on the role of banking union in the reform of European governance and on the fundamental political issues in the discussion about banking union.