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A Nobel Winner’s Radical Proposal to Solve the Euro Area’s Woes

  • Eric Maskin says politicians should not set fiscal policy
  • Fiscal parameters to be set by experts like monetary policy
Economist Eric S. Maskin

Economist Eric S. Maskin

Photographer: Emile Wamsteker/Bloomberg News

Fiscal policy should be taken out of the hands of politicians and entrusted to non-elected officials just like monetary policy, Nobel laureate Eric Maskin said at a European Central Bank research conference.

“A radical proposal? Yes -- but i think we can all agree that the euro zone needs pretty substantial reform if it’s going to get fiscal and monetary policy in line with one another,” Maskin, who was awarded the 2007 Nobel prize in economics, said at a lecture at the ECB’s first Annual Research Conference in Frankfurt. “We’ll all be better off -- speaking here as an American -- if the euro zone continues to survive and flourish. But this is not going to happen automatically.”