The European Roots of the Eurozone Crisis: Errors of the Past and Needs for the Future

This book examines the Eurozone crisis in light of theoretical and empirical evidence. The first half explores specific theoretical contributions within a framework of growth theory models to examine the two major pillars of the European construction, the European Central Bank and the Maastricht Treaty, and seeks to explain why they are theoretically wrong.  The second half presents results of counterfactual simulations using the Oxford Econometric model and estimates what the Eurozone has lost in terms of economic and social cost from 2002 to 2014 as a consequence of the super-evaluation of the Euro and the Maastricht Treaty parameters being mistakenly fixed and pursued. Finally, the author supports the urgent need to refund the European Union, up-dating The Maastricht Treaty and the ECB statute to build three concentric circles: the USE (United States of Europe), the EU (European Union), the EAFTDA (Europe/Africa Free Trade and Development Area).

Mario Baldassarri is Professor Emeritus of Economics at Sapienza University of Rome, Italy. He was member of the Italian Government as Vice-Minister of Economy and Finance (2001-2006), Senator of the Italian Republic (2006-2013) and Chairman of the Permanent Senate Commission in Finance and Treasury (2008-2013). This book complete a trilogy about World Economy and Europe together with two other previous books: The World Economy toward Global Disequilibrium  and How to reach full employment and high growth in Europe. He is also Editor of Quo Vadis: World Economy and Institutions at a Cross-roads and of the series Central Issues on Contemporary Economic Theory and Policies.