Publications

To truly compete on the global stage, the eurozone must mutualise part of its public debt—and build a deeper, more efficient capital market. A commentary by Lorenzo Bini Smaghi

The European Union has the money to attract researchers under threat in the US and should coordinate a scheme to deploy it. A commentary by Heather Grabbe, and Daniel Gros

To enable the United Kingdom to take part in programmes on procurement, standardisation, interoperability, and industrial cooperation, a new institutional framework is needed—potentially inspired by the EU–Switzerland committee model. A commentary by Jonathan Faull 

It is time for an ambitious foreign policy, security and defence partnership (FSDP) between the EU and the UK, tailored to reflect the UK’s unique situation, which should be swiftly negotiated and concluded. A commentary by Alan Dashwood 

The discussion focused on progress made so far and the challenges that still lie ahead in shaping a new framework for UK–EU collaboration in security and defence.

To restart growth, the EU needs to focus on productivity and innovation. This does not require hundreds of billions of euros in new expenditure, but rather a sharp focus on the efficiency of existing budgets coupled with innovation-friendly rulemaking. A Policy Brief by Daniel Gros, and Jacob Funk Kirkegaard 

Replacing the Chair is not enough to change monetary policy, as Trump would like — namely, to lower interest rates to boost economic growth. A commentary by Lorenzo Bini Smaghi

Lessons from first principles of classic trade policy welfare analysis. A Policy Brief by Daniel Gros 

The real challenge is not the size of successful tech firms per se, but how their scale is leveraged — whether to support vibrant ecosystems or to entrench monopolistic control. A commentary by Francesco Decarolis.

April’s US inflation data will offer the first glimpse of the real impact of the global trade war that the US administration launched on the “Liberation Day”. A commentary by Ignazio Angeloni

A rise in US Treasury yields would immediately feed through into other countries’ borrowing costs, tightening global financial conditions. A commentary by Lorenzo Bini Smaghi

There are immediate liquidity problems, and then the choice between lowering inflation risk or supporting the economy. A commentary by Ignazio Angeloni

Tariff moves have also compromised the rest of the Trump administration’s strategy, from taxes to energy. A commentary by Lorenzo Bini Smaghi

Direct public subsidies to Chinese BEV producers in the forms of grants and tax breaks are relatively small. The Commission motivates a large part of the countervailing duties (CVD) with the argument that entire markets in China are so distorted by industrial policies that the Chinese BEV producers do not face market prices for credit and batteries. A Policy Brief by Daniel Gros, and Weinian Hu 

Is the world de-globalizing? Is the global economy fragmenting along geopolitical lines? This article provides an overview of the available empirical evidence on de-globalization and fragmentation. A working paper by Italo Colantone

Mainstream politicians must ensure that the state can once again be a force for good. This means investing in public service delivery, allowing houses to be built, and reducing administrative burdens. A commentary by Catherine De Vries

The ECB might counterbalance the impact of tariffs by steering the exchange rate, but that would be a mistake. Maintaining a focus on price stability is paramount.

The advantages of the Trump administration's ‘reciprocal’ tariff structure for EU industry on the US market are likely to outweigh the direct impact of the 20% tariff that EU exports will now face. A commentary by Daniel Gros

By supporting Marine Le Pen, members of the international nationalist coalition have put partisan solidarity before defending the interests of national taxpayers. A commentary by Sylvie Goulard 

The intrinsic contradictions of Trump’s strategy will strike the United States where it is most vulnerable: inflation and employment. In the ensuing moves of this chess game, it is vital to project both strength and flexibility. A commentary by Ignazio Angeloni

Amid Trump’s activism, many accuse Europe of lacking timely and effective decision-making. But distinctions are necessary. A commentary by Lorenzo Bini Smaghi

Weakening the EU climate corporate reporting in the name of competitiveness, or complementing it with specific measures to mitigate its negative economic impacts? A commentary by Sylvie Goulard, Mélanie Marten, Thomas Rowley, Romain Svartzman 

While economic theory and empirical evidence on human capital affirm the positive effects of education and training on productivity and economic growth, there is a tendency to treat skills enhancement as a universal remedy for labor market inefficiencies. A Policy Brief by Pietro Galeone

A firm but measured response, aligned with rules and European interests, is better than excessive conciliation with the US administration. Here's why. A commentary by Lorenzo Bini Smaghi

From Germany's debt choices to Italy’s stance on rearmament, Ambassador Luigi Mattiolo analyses how the EU is evolving in the age of Trump. An interview by Stefano Feltri

European countries should plan for a Peace Enforcement mission and prepare for either Non-Combat Security Assistance and Support or for Mobile Rapid Reaction Force in order to be prepared for a “what if conflict resumes”. A Policy Brief by Andrea Gilli, Mauro Gilli, and Niccolò Petrelli

The administration’s emphasis on stablecoins risks eroding the Federal Reserve’s independence and could weaken the dollar’s global standing. A commentary by Ignazio Angeloni

Berlin’s pledge to do “whatever it takes” on military and infrastructure spending raises government bond yields across the continent. A commentary by Ignazio Angeloni

A coalition of most EU Member States plus the UK and Norway should create a European Security Fund to provide Ukraine with a reliable source of financing, large enough to substitute the US. A Policy Brief by Daniel Gros 

Financial discipline, growth potential, and deeper EU integration reassure investors amid rising defense budgets. A commentary by Lorenzo Bini Smaghi

Voluntary certification is a novel approach that can restrict the harmful practices of some dominant platforms and motivate and reward emerging platforms that align their practices with the public interest. A Policy Brief by Dovev Lavie, Oreste Pollicino, and Tommaso Valletti

Trumponomics Faces Market Test: Implications for Europe

The heightened risk aversion triggered by Trump's policies has not spread to Europe, where optimism prevails regarding more cohesive and responsive policymaking. A commentary by Lorenzo Bini Smaghi

The normalisation of war in political discourse is forcing a renegotiation of the European welfare state, a delicate balancing act that will determine whether defence budgets remain sustainable in the long run. A commentary by Stephanie Hofmann & Catherine E. De Vries 

The explicit goal of the new US administration is to protect the US tech industry and to dismantle European regulations, reverting to bilateral arrangements where the strongest naturally prevails. A commentary by  Lorenzo Bini Smaghi

The EU, along with the UK and Norway, has the resources and capabilities to sustain Ukraine’s fight and provide security guarantees if Putin agrees to a ceasefire. A commentary by Daniel Gros 

Should China and the US – where major market players are based – manage to sideline Europe in its regulatory isolation, the EU’s influence may wane. A commentary by Marco Bassini.

After the 2008 financial crisis, the ECB's supervision restored the soundness of euro area banks. Now, it has the opportunity to build a banking sector of continental dimension. A commentary by Ignazio Angeloni.

Trump’s ambitions to extend U.S. influence over neighboring countries align with Karl Haushofer’s notorious geopolitical doctrine. A new global order is emerging, and Europe may not be part of it. A commentary by Andrea Colli

As 80 years ago, today’s large states aim to impose their will on smaller nations. This time, however, no European leader is at the table. Will incoming German Chancellor Merz change this? A commentary by Catherine De Vries

The Trump II Administration is likely to throw a wrench in coordination across European states in nearly every forum except one: the IMF and multilateral financial institutions. A Policy Brief by Catherine De Vries, and Sienna Nordquist 

The shared opposition of environmentalists and farmers to the EU-Mercosur trade deal reflects concerns about economic liberalization at the expense of ecological and social equity. A commentary by Pietro Galeone, Joseph Christopher Proctor, Romain Svartzman

The US President has halted plans for a central bank digital currency: a mere show of strength to undermine the Fed’s independence. A commentary by Ignazio Angeloni

The incumbent’s full control over a pivotal realm of power implies several risks related to the incumbent’s behavior. The first temptation is to self-justify the strict control over AI technology “for the good of mankind” . A commentary by Andrea Colli

This report focuses on how the EU can manage global trends in the digital ecosphere, with a particular emphasis on the rules that it has set to govern relationships between platforms and businesses

The global financial system is at a crossroads of two related processes: post-crisis reform—the so-called Basel III—that is missing its final stage, and the new political course in the United States, where the incoming administration has declared war on all pre-existing rules.

A recently published report by the Institute for European Policymaking, written by a multidisciplinary team of researchers at Bocconi University and the Toulouse School of Economics, provides timely insights into these challenges and offers concrete policy recommendations across three critical areas

The German economy is weak not because of a lack of investment, but because of the sectors it goes into. German industry has specialised in mid-tech sectors, like automotive, that are now under increasing competitive pressure from China. A commentary by Daniel Gros

Former U.S. Treasury Secretary Larry Summers has acknowledged that the neutral interest rate will be higher than previously expected. This shift carries significant implications for public finances.

The empirical evidence does not confirm the hypothesis that the public debt tends to be more stable in countries where the (real) interest rate is systematically lower than (real) growth. On the contrary. 

A policy Brief by Lorenzo Bini Smaghi

The geopolitical references in the inaugural address of the new US President are striking because they align closely with the concept of “classic geopolitics”—a vision of politics and international relations as an aggressive, zero-sum game. A commentary by Andrea Colli

Much of the impact of the new Trump Administration on Europe will depend on how the balance of power within the US plays out between the President and key corporate leaders, of Big Tech in particular

Both in the U.S. and Europe, the excess liquidity created over past decades has been only partially reabsorbed. It remains ready to fuel inflation if a matchstick is struck. A commentary by Franco Bruni

Linking relocation to a job in Ukraine would ensure that the return does not constitute a burden for Ukrainian public finances which are already under enormous strain

IEP@BU seeks to foster discussions—even on the most divisive topics—that are firmly rooted in data and rigorous analysis of empirical evidence

In a world where the number of smartphones is nearing that of people, and each device typically hosts two or three payment applications, the added value of X's new tool is limited

In a more dangerous and unstable world, Europe must thus prepare for war to maintain peace and its security: as Vegetius noted, si vis pacem para bellum. However, increasing budgets is not enough if the EU does not address key strategic questions.

Reduced economic insecurity generates not only a direct increase in demand for populist commitments but also a change in culture in the direction of lower trust and prevalent exclusionary rhetoric, which in turn are further indirect channels through which populist movements thrive

We must be realistic about the level of structured cooperation we can expect to be able to achieve with the EU in the immediate term. But we should be ambitious

Remarks by Sir Jonathan Faull, Chair of European Public Affairs, Brunswick Group.

The foreign policy landscape is shifting fast, and it is time to overcome the post-Brexit- mutual diffidence. 

It defies any sense of equity that countries facing rising sea levels, or like Pakistan which suffered a flash flood in 2022, submerging a third of the country, should borrow on commercial terms to cope. 

The discussion explored practical ideas around the process of establishing a broad and deep partnership between the United Kingdom and the European Union in the areas of foreign, security, and defence policy.

Lack of integration of capital markets is a major source of weakness and declining competitiveness of the European economy. While efforts to complete harmonization of capital market legislation in this domain should retain highest priority in the new Commission’s work programme, there is room to advance integration by exploiting the STS regulation introduced by the EU in 2017 as part of its broader efforts to implement the CMU.

The main finding is that at the peak of the latest tightening cycle, the ECB monetary policy stance was no more restrictive than it was at the peak of the two preceding ones; actually, probably less. Report Co-ordinator Francesco Decarolis.

A second term for Donald Trump could structurally intensify the trend toward trade fragmentation, heightening tensions, particularly between the United States and China, the world’s two largest economies.

The narrative of the EU as a peace project is that it allowed Europeans to reject military investments on the basis of the excuse that we were living in a post-war society. This is not true.

The fact that prices have risen considerably compared to four years ago will matter more to most voters when voting, and not that they have caused growth to slow.

The Honorary President of the IEP@BU Mario Monti opened the international conference "Democracy Today," organized by the Konstantinos Karamanlis Foundation in Athens, on the occasion of the fiftieth anniversary of Greece's transition to democracy

The age demographics in key swing states reveal a significant number of young potential voters who are more likely to support Kamala Harris. However, young voters are historically the least likely to turn out at the polls.

Europe will be called upon to make a difficult decision between pursuing the protectionist policies of the United States or taking advantage of the diplomatic and economic opportunities that American isolationism could offer.

“The Commission would like to be taking the lead on defense policy, but defense remains the domain of Member States”. Thomas Gomart is one of the most influential experts on foreign relations and geopolitics at the EU level: he has been director of the Ifri, Institute Francais de Relationes Internationales, since 2015. An expert in Russian geopolitics and the history of international relations, he has recently published the book L'accélération de l'histoire. Les noeuds géostratégiques d'un monde hors de contrôle ( Éditions Tallandier, 2024).

 The first elected president of the European Council, Herman van Rompuy, discusses how to fix the decision-making process at the EU level 

On 16 October 2024, Claudia Buch delivered a lecture titled Bank Profitability: A Mirror of the Past, Creating a Vision for the Future at Bocconi University. The event was co-organized by the Baffi Center on Economics, Finance, and Regulation and the Institute for European Policymaking @ Bocconi University (IEP@BU).

The 16^th meeting of the Conference of the Parties (COP 16) to the Convention on Biological Diversity (CBD), or "Biodiversity COP 16", will take place in Cali, Colombia, from October 21 to November 1.

The costs and benefits of sharing national sovereignty are different across EU countries. In our framework, costs mainly depend on the relative strengths of each national state and intermediate institutions.

Building on a previous analysis of the trends of convergence and divergence between peripheral and core EA-12 countries after the euro area sovereign debt crisis (Bordignon et al., 2023), this work investigates the long-term evolution of such differences in economic, institutional, and political outcomes, testing whether a pattern of convergence was finally resumed and comparing the effects of this crisis with those induced by the Covid-19 pandemic.

The Uni­Credit-Com­merzbank deal is a test case for the ECB, which will rever­ber­ate into the future, and be a golden oppor­tun­ity for its super­vis­ory board to uphold its inde­pend­ence

This dismantling of the European Grean Deal would be one of the main mistakes that the Europeans could make. The often critics should not lead us to underestimate or marginalize people's desire to take action and deny the necessity to accelerate the transition.

Robust port infrastructure can significantly mitigate the risk of supply chain disruption, suggesting that government efforts are better targeted at improving the performance of ports and critical infrastructure more broadly, rather than implementing protectionist measures.

On September 19, mister Roth gave a lecture to Bocconi students titled “Europe at the Crossroads: Turning Today’s Poly-Crisis Into Tomorrow’s Poly-Opportunity”. Eleanor Spaventa, a professor of European Law at Bocconi and a member of the IEP@BU managing board, chaired the event co-hosted by IEP@BU and the Department of Legal Studies.

While the focus of the new Commission will be crystallizing over the months and years to come, this short analysis of the mission letters for the future Commissioners suggests that the recent intervention of Mario Draghi on Europe’s competitiveness has been agenda-setting for the policy priorities as defined by Commission President Ursula von der Leyen. 

Project Beethoven allocates €2.51 billion to “…strengthen the Dutch chip industry and support the future growth of activities in the Brainport Eindhoven hub.”, “…investment in vocational and professional talent, and in sufficient space, good accessibility and affordable housing…”.  

After a detailed presentation of the Green Deal’s main measures in each sector, we will focus on a few of them to analyze its failures or successes in greater detail. 

The economic transformation required to reach global net zero goals relies on the mining and transformation of certain minerals and metals for the production of low-carbon technologies. Increasing global demand for these critical materials, combined with their uneven geographical distribution, raise potential supply issues that pose economic security and transition risks for the European Union. This report sets out the nature of the challenge, the policy responses and ways forward for the bloc.

The September 2024 state elections in Germany mark a low point in public support for the governing left-wing coalition and a high point for the populist right. Often overlooked, the elections might also mark the fading of the German socialist party Die Linke into political irrelevance. Its demise teaches us valuable lessons for modern European politics

The fight against poverty is not a new one. It has been a feature of national policies and academic research for many decades. However, the ways in which a State fights against poverty have changed over time, continuously evolving to approach new challenges through the adoption of new tools and policies.

The report on The Future of European Competitiveness presented by Mario Draghi provides a clarion call for economic reforms to stop Europe’s relative decline.  This short comment cannot do justice to the report with over 300 pages of supporting material.  We will concentrate just on two key messages regarding innovation and investment.

We find that the profitability of high-risk tech companies, associated with high rates of failure, is very dependent on the cost of restructuring, which itself is driven by employment protection legislation. 

As Europe begins to face the start of its own relationship with fentanyl, it is paramount that policymakers learn from the lessons of American and Australia in crafting their response. Policymakers need to bear in mind that drug users are consumers who will respond to the changing economic environment wrought by their efforts.

The mobile telecom sector is often taken as a case study of fragmentation of the single market leading to less investment and a loss of technological leadership. However, a closer examination of the data suggests that the fragmentation also implies more competition leading to lower prices for consumers in Europe.

A popular thesis in policy circles is that there is an “investment gap” that Europe needs to fill to face the great challenges of our times, such as the digital and green transitions. However, the notion of the “investment gap” used by policymakers is often vague and therefore it risks legitimate a wasteful allocation of public resources.

After revisiting the pros and cons, this paper concludes that, all in all, the rationale for introducing an ECB-sponsored digital euro for citizens, retailers, and producers, is not solidly established. Today’s highly dynamic, innovative, and efficient digital payment ecosystem does not require such an instrument, which would unavoidably duplicate existing applications and probably struggle to match private innovation.

If Trump is elected in November 2024, the security outlook of Europe could deteriorate very fast as Russia may attempt to seek the opportunity of taking NATO off balance. It is therefore essential that the Commission and the forthcoming Defence Commissioner begin the policy planning and design well in advance and preferably as soon as they take office, as to move past preliminary negotiations and have blueprints ready for approval should the situation require it.