As a further side effect, it would crucially contribute to induce a “reconvergence” of Europe’s economies, in other words, the gap between net debtor and net credit countries would be narrowed. This in turn would facilitate consensus on a common course of action in the ongoing revamping of the institutional architecture. What is the role of monetary policy in this context?
What it can do is to stabilise growth near its trend over extended horizons, but it cannot raise the trend. Hence, it only constitutes a line of defence against an escalation of the three dimensional crisis.