Non resident scholars

Michiel Bijlsma

Michiel Bijlsma

Michiel Bijlsma joined Bruegel as a visiting fellow in January 2012. Michiel is program leader financial markets at the Netherlands Bureau for Economic Policy Analysis (CPB). He has a PhD in theoretical physics from the University of Utrecht, and is an extramural fellow at Tilec, University of Tilburg. His work at Bruegel focuses on the added value of the financial sector and structural differences between the financial sector in Europe and in the United States.

Michiel’s research is in the areas of Corporate Governance, Banking, and Health Care markets. He has co-authored popular Dutch books on the 2007-2008 financial crisis and the current European debt crisis. Prior to his work for CPB, Michiel has worked as a senior economist at the Netherlands Competition Authority on high-profile cases on fee structures of debit card payment systems and as a consultant for international firms at Ernst & Young risk management.

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Michiel Bijlsma

Who’s afraid of the AQR?

Banks have incentives to recapitalize in socially undesirable ways and to hide losses on their balance sheets. Will the comprehensive assessment solve these issues by forcing European significant banks to recognize losses and to recapitalize by issuing new equity instead of deleveraging?

By: Michiel Bijlsma and Sander van Veldhuizen Topic: Finance & Financial Regulation Date: October 24, 2014
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Working Paper

Cross-country insurance mechanisms in currency unions

Cross-country insurance mechanisms in currency unions

Countries in a monetary union can adjust to shocks either through internal or external mechanisms. We quantitatively assess for the European Union a number of relevant mechanisms suggested by Mundell’s optimal currency area theory, and compare them to the United States.

By: Nancy van Beers, Michiel Bijlsma and Gijsbert T. J. Zwart Topic: Finance & Financial Regulation, Global Economics & Governance Date: March 27, 2014
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Working Paper

The changing landscape of financial markets in Europe, the United States and Japan

The changing landscape of financial markets in Europe, the United States and Japan

We compare the structure of the financial sectors of the EU27, Japan and the United States, looking at a set of 23 indicators.

By: Michiel Bijlsma and Gijsbert T. J. Zwart Topic: Finance & Financial Regulation Date: March 18, 2013
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Michiel Bijlsma

Six lessons for Europe from the nationalization of SNS Reaal

Recently the Dutch government nationalized the Dutch financial conglomerate SNS Reaal. The intervention was the first use of the Intervention Act introduced in the beginning of 2012.

By: Michiel Bijlsma Topic: European Macroeconomics & Governance Date: March 13, 2013
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Michiel Bijlsma

No ringfencing makes sense, but don't take off the gloves - implementing the recommendations in the Liikanen report

Michel Barnier, European commissioner in charge of regulatory reform, has indicated implementation of the recommendations in the Liikanen report will stop short of ringfencing certain bank activities. The argument is that this could undermine fragile European growth outlook. This viewpoint makes sense.

By: Michiel Bijlsma Topic: European Macroeconomics & Governance Date: February 4, 2013
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Michiel Bijlsma

Dutch elections – anti-Europe lost, but did pro-Europe win?

The Dutch elections have ended in a race between the liberal party (VVD) and the social-democratic party (PvdA). The preliminary results indicate that VVD has 41 seats (up from 31) whereas PvdA has 39 seats (up from 30) out of a total of 150 seats. Especially the latter party has won while endorsing a pro-European […]

By: Michiel Bijlsma Topic: European Macroeconomics & Governance Date: November 9, 2012
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Michiel Bijlsma

The Liikanen report - is size the elephant in the room?

Yesterday, the High-level Expert Group on reforming the structure of the EU banking sector chaired by the governor of Finland’s central bank Erkki Liikanen, in short the Liikanen report  issued its report. Apart from endorsing other currently discussed points such as common bank supervision and the resolution schemes, one of its main findings is that […]

By: Michiel Bijlsma Topic: European Macroeconomics & Governance Date: November 9, 2012
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Michiel Bijlsma
Jasper Lukkezen

Should we worry about Target2 imbalances? Why Central Bank negative equity does and doesn’t matter

Over the past few months Germany has become the safe haven of Europe. Depositors fearing a euro break-up have moved their deposits away from the periphery, realizing effective insurance. As a consequence, peripheral banks’ funding has shifted from private to public sources (see e.g. Pisany-Ferry and Merler). The Target2 imbalances that capture this have risen to unprecedented levels.

By: Michiel Bijlsma and Jasper Lukkezen Topic: European Macroeconomics & Governance Date: September 4, 2012
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Michiel Bijlsma
Jasper Lukkezen

Target 2 of the ECB vs. Interdistrict Settlement Account of the Federal Reserve

The Target 2 discussion is still going strong in Europe especially after the president of the German Bundesbank has expressed his concern as regards the quality of the collateral held by the ECB and National Central Banks. Observers such as Hans-Werner Sinn have claimed that the US Federal Reserve had a fundamentally different (and presumably better and more stable) set up.  

By: Michiel Bijlsma and Jasper Lukkezen Topic: European Macroeconomics & Governance Date: August 28, 2012
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Michiel Bijlsma

Eurocrisis lessons from banking regulation: create collateral in return for support

The similarities between banks and countries in a monetary union are striking. First, like banks, countries in a monetary union can face a self-fulfilling run resulting in sudden stops. Second, just as one banks’ risk taking increases other banks’ probability of default because of contagion, as the current crisis in the eurozone shows, contagion is especially strong within a monetary union due to cross-border trade, impact on domestic banks, or investor beliefs on correlated risk (see e.g. the review in Pericoli and Sbracia, 2003). Third, just like banks considered to be sound turned to be insolvent in the 2007-2008 financial crisis, we are rediscovering that also in advanced economies debt levels can become unsustainable. And while a country with debt denominated in its own currency can not be forced into default by markets, this is not the case in a monetary union.

By: Michiel Bijlsma Topic: European Macroeconomics & Governance, Finance & Financial Regulation Date: August 14, 2012
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Michiel Bijlsma
Shahin Vallée

The creation of euro area safety nets

The financial crisis has exposed the need to devise stronger and broader international and regional safety nets in order to deal with economic and financial shocks and allow for countries to adjust. The euro area has developed several such mechanisms over the last couple of years through a process of trial and error and gradual […]

By: Michiel Bijlsma and Shahin Vallée Topic: European Macroeconomics & Governance Date: July 6, 2012
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Working Paper

The creation of euro area financial safety nets

The creation of euro area financial safety nets

This paper provides an overview of the recent financial stability mechanisms and their various shortcomings and tries to brush the outline of a more comprehensive safety net architecture that would coherently address the banking, sovereign and external imbalances crises against both transitory and more permanent shocks.

By: Michiel Bijlsma and Shahin Vallée Topic: European Macroeconomics & Governance, Finance & Financial Regulation Date: July 2, 2012
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