Fiscal integration as a Pareto improvement

10/12/2026 European Central Bank Central banks

Fiscal integration in a currency union is generally understood as a transfer from fiscally strong to fiscally weak countries. I show that this changes when common debt is paired with a non-defaultable common tax, even if national debt remains defaultable. The risky country gains from intertemporal trade: it receives a grant financed by a perpetual obligation it discounts more heavily than lenders do. The cost to the safe member is second-order and the tax removes it by insuring imperfectly correlated cycles rather than transferring resources in expectation.

Private equity beyond the target: how buyouts reshape supply chains

10/08/2026 European Central Bank Central banks

The impact of private equity buyouts on target firms is well documented, yet empirical evidence on the impact of buyouts across the supply chain remains scarce. We address this gap by using unique production network data to examine how supply chains contribute to the ability of private equity investors to create and extract value. We show that, on average, suppliers of firms backed by private equity outperform their peers because of increased demand for inputs from customers backed by private equity – rather than alternative mechanisms such as knowledge spillovers.

Energy price cap: the cost of your coffee could be about to go up

10/07/2026 The Conversation UK

Rawpixel.com/ShutterstockThis autumn, the cost of gas and electricity for a typical UK household is expected to rise from £1,663 to £1,723 a year.

The change, due to higher wholesale gas prices, will be easy enough to spot on a household bill. But those rising costs can also affect people in less obvious ways, through the price of a coffee, for example, or a pub lunch or haircut.

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