Policy brief

The Blue Bond Proposal

This Policy Brief proposes a Blue Bond to resolve high debt levels in vulnerable states.

Publishing date
05 May 2010

Soaring debt levels and the crisis in Greece has sharpened the focus on fiscal sustainability among eurozone members.

The European Union has to tackle high debt levels in vulnerable states which are compounded by a hike in risk premiums on government bonds leading to a debt trap, while designing ways to efficiently finance debt.

Furthermore, European solidarity with weaker states should not undermine incentives for individual members to pursue fiscally sustainable policies.

This Policy Brief proposes a Blue Bond to resolve these challenges.

The authors, Bruegel Non-resident Fellow Jakob von Weizsäcker and Jacques Delpla from Conseil d'Analyse Économique, Paris, explain the economics behind their proposal, its institutional underpinnings and the implication of it on various participating countries.

About the authors

  • Jakob von Weizsäcker

    Jakob von Weizsäcker heads the department for economic policy and tourism at the Thuringian Economics Ministry in Erfurt and is a non-resident fellow at Bruegel where he was resident fellow form 2005 to 2010.

    He previously worked at the World Bank in Washington (2002-2005) where he was country economist for Tajikistan and the Federal Economics Ministry in Berlin (2001-2002) where he headed the office of a junior minister. Before that, he worked for Vesta, a venture capital firm, and held research positions at the Center for Economic Studies in Munich and CIRED in Paris.

Related content

Report

Aufbruch in die Euro-Union

Warum ohne mehr Integration weitere Krisen drohen. Elf deutsche Ökonomen, Politologen und Juristen – die Glienicker Gruppe – entwickeln Vorschläge für

Jakob von Weizsäcker and Guntram B. Wolff