EconomiX Jean-Pierre Allegret
email: jallegret@u-paris10.fr.

Audrey Sallenave
email: audrey@sallenave.fr.

Capital Flow Bonanzas and Monetary Policy in Emerging Europe: Responses to the Global Financial Crisis

Keywords: capital flows, emerging European countries, financial crisis, monetary policy JEL Codes: E4, E5, F3, P3

We analyze the conduct of monetary policy in some new member states of the EU and some EU candidates over the period 2000-2013. We investigate why monetary policy has been ineffective to insulate domestic liquidity from capital inflows and why some countries from emerging Europe have been especially constrained to respond to the crisis. Our contribution is threefold. First we show that countries with fixed exchange rate regimes have encountered significant obstacles to conduct monetary policy to cope with large capital inflows and credit booms during the period preceding the financial crisis. Second we shed in light that pegged countries have been more constrained to respond to the global financial crisis than nonpegged economies. Third, countries with high currency mismatch and financial vulnerabilities seem unable to adopt monetary policy dedicated only to macroeconomic stabilization.

Introduction

This paper tends to analyze the conduct of monetary policy in some new member states of the European Union (EU thereafter) and some EU candidates over the period 2000-2013. More specifically, we consider a sample of nine former transition economies: Bulgaria, Croatia, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, and Serbia. All these countries have followed a pattern of domestic and external financial liberalization related to their accession process to the European Union. However, these countries differ in terms of exchange rate regimes adopted over the studied period. More specifically, a first group including Bulgaria, Croatia, Estonia, Latvia, and Lithuania adopted fixed regimes while a second groupconsisting of Hungary, Poland, Romania, and Serbia-followed floating regimes. 1 The global financial crisis suggests that countries with more leveraged domestic financial system and more rapid growth in credit to the private sector exhibited more output losses than other economies (IMF, 2010;[START_REF] Berkmen | The global financial crisis: explaining cross-country differences in the output impact[END_REF]. In addition, vulnerabilities to shocks increased when the credit boom was funded from abroad (CGFS, 2009). Such features characterize many countries in emerging Europe. Thus, our first aim is to investigate why monetary policy has been ineffective to insulate domestic liquidity from capital inflows.

The global financial crisis of 2008-09 had led to a renewed interest of the analysis concerning economic policies responses in emerging countries to financial crises (Ghosh et al., 2009, Vegh and[START_REF] Vegh | Overcoming the fear of free falling: monetary policy graduation in emerging markets[END_REF]. While in previous episodes of financial crises, these economies tended to adopt procyclical monetary policy [START_REF] Kaminsky | When it rains, it pours: procyclical capital flows and macroeconomic policies[END_REF], a growing number of studies have provided new empirical evidence according to which emerging economies tend to adopt counter-cyclical policies on a more regular basis. An interesting exception is emerging Europe [START_REF] Josifidis | Adjustment mechanisms and exchange rate regimes in new 2004 EU members during the financial crisis[END_REF]2014). Our second aim is to analyze why some countries from emerging Europe have been especially constrained to respond to the crisis.

A growing literature investigates the impact of the unconventional monetary policy 2 followed by major central banks on international capital flows, and, more specifically, capital inflows into emerging countries (IMF, 2013). The third aim of this paper is to assess to what extent central banks from our studied countries can conduct an independent monetary policy. To this end, a panel regression with fix effects is estimated to identify the main factors influencing the determination of short term interest rate. We focus more particularly on the monetary policy framework adopted in the aftermath of the global financial and European sovereign debt crises in order to check for the spillovers effects resulting from the monetary policy adopted by the European Central Bank.

The rest of this paper is structured as followed. Section 1 analyzes the accumulation of macroeconomic imbalances over the period 2000-2007. To this end, not only do we compare our sample to Latin American and South-Asian countries, but also we see to what extent floaters and fixers differ within our sample. Section 2 considers the responses of monetary policy during the global financial crisis. We explain why some European emerging countries had been especially constrained to a conduct counter-cyclical monetary policy. Section 3 investigates to what extent short term interest rates in our sample countries are influenced by other variables than domestic inflation and output as suggested in a standard Taylor rule.

Section 4 concludes.

The accumulation of macroeconomic imbalances before the Global financial crises

Figure 1 suggests that Emerging Europe have particularly suffered from the 2008-2009 global financial crisis. Indeed, except Poland, all studied countries entered into recession and, above all, many of them experienced higher growth losses than both emerging developing countries and advanced economies. The figure also shows that recession had been deeper in countries with fixed exchange rate regimes (left side) than in countries with floating exchange rates (right side).

These different impacts of the Global financial crisis are in part explained by the macroeconomic imbalances accumulated over the period 2000-2007. Indeed, an extensive literature shows that initial conditions matter: countries that entered into the crisis with sizeable domestic and external imbalances have recorded more poor economic performances during the crisis [START_REF] Lane | The cross-country incidence of the global crisis[END_REF][START_REF] Frankel | Are leading indicators of financial crises useful for assessing country vulnerability? Evidence from the 2008-09 global crisis[END_REF].

[Insert Figure 1]

The aim of this section is to stress that countries with fixed exchange rate regimes encountered more difficulties to face macroeconomic imbalances than floaters.

Domestic imbalances

Figure 2 exhibits a feature that characterizes many crises episodes. Indeed, the positive output gap tends to increase just before the occurrence of the global crisis suggesting the presence of an unsustainable economic boom. 3 Figure 2 has a second striking feature: the positive output gap tends to be higher for peggers than for floaters.

[Insert Figure 2]

Monetary policy seems to have weakly reacted to the increasing positive output gap. In this perspective, the IMF (2008) has stressed that monetary policy conditions loosened in Emerging Europe before the Global financial crisis, particularly in the Baltics. Indeed, policy rates in this region tend to be lower than policy rates implied by the application of the Taylor rule by central banks. Figure 3 bears out this point by exhibiting the short term interest rates in real terms.

[Insert Figure 3]

Real short term interest rates are negative in many of our countries with fixed exchange rate regimes at the opposite to floaters suggesting the formers are constrained in terms of monetary policy to respond to the acceleration of growth rates. [START_REF] Berkmen | The global financial crisis: explaining cross-country differences in the output impact[END_REF] investigate factors driving the growth performance in 2009 -measured by the revisions in GDP growth forecasts before and after the crisis-for a sample of 43 emerging markets. Their main finding is that countries with more leveraged domestic financial system and more rapid growth in credit to the private sector suffer from larger downward revisions of GDP forecasts. In addition, the IMF (2010) stresses that countries which experienced a pre-crisis credit boom underwent a dramatic output busts during the crisis.

The left side of figure 4 exhibits the credit growth in our sample, Latin America, and Asia.

We see that Emerging Europe experienced rapid growth in their credit to the economy. The right side confirms -by considering the growth differential between credit and GDP-the extent of the credit boom in our studied countries. In addition, higher growth differentials are observed in economies with fixed exchange rate regime relative to floaters.

[Insert Figure 4]

The increase in financial vulnerabilities

Credit boom in Emerging Europe had been accompanied by an increase in financial vulnerabilities. Interestingly, figure 5, left side, shows that, in Emerging Europe, the growth in deposits has been insufficient to fund such credit growth. Indeed, the figure exhibits a striking increase in the loan-to-deposit ratio meaning that banks had to rely massively on other refinancing sources. The right side of figure 5 not only confirms the previous remark, but also portrays an interesting feature: the discrepancy between changes in deposit and credit to GDP had been especially sizeable in Emerging European countries with fixed exchange rate regimes.

These previous data are in line with [START_REF] Magud | Exchange rate flexibility and credit during capital inflow reversals: purgatory…not paradise[END_REF] who investigate how economies with different degrees of exchange rate flexibility behave during capital inflows reversals 4 . Their econometric estimates get two main results. On the one hand, a higher degree of exchange rate flexibility is accompanied by a lower domestic credit growth. On the other hand, countries with flexible exchange rates are less vulnerable to episodes of capital inflows reversals. Similarly, [START_REF] Bakker | The credit boom in the EU new member states: bad luck or bad policies?[END_REF] noticed that credit booms experienced by some new EU member with fixed exchange rate regimes in emerging Europe in the 2000s have been difficult to contain.

[Insert Figure 5]

Financial vulnerability in Emerging Europe was considerably stronger relative to other emerging regions insofar as a significant part of the credit boom in this region had been funded from abroad. Figure 6 exhibits the rapid growth of assets of reporting banks vis-à-vis our sample countries from June 2006 to June 2008.

[Insert Figure 6]

Figure 7 suggests that the expansion of domestic credit had been fueled by foreign funds. This figure has an interesting feature. Indeed, focusing on our studied countries, we see that the relationship between consolidated foreign claims of BIS reporting banks and changes in domestic credit to private sector had been especially strong among peggers countries.

[Insert Figure 7]

Different motives can account for such behavior. First, lending interest rates tend to be lower in international financial centers while exchange rate risks seem low when authorities peg their currency against the dollar (Asian countries in the 90s') or the euro (Emerging Europe now) [START_REF] Eichengreen | Exchange rates and financial fragility, new challenges for monetary policy[END_REF]. Second, currency mismatch may result from recurrent domestic instabilities that render uncertain the future value of the domestic currency.

As a consequence, issuing debts in foreign currencies is easier [START_REF] Mishkin | The causes and propagation of financial instability: lessons for policymakers, in Maintaining financial stability in a global economy[END_REF]. Finally, as stressed by [START_REF] Eichengreen | Currency mismatches, debt intolerance, and original sin: why they are not the same and why it matters, in Capital controls and capital flows in emerging economies: policies, practices and consequences[END_REF], emerging economies may be unable to borrow in their own currencies insofar as international investors are reluctant to diversify their portfolio i.e. to add currencies of developing countries, besides dollar, euro, yen, pound, and Switzerland franc. The important point is that this so-called "original sin" is not due to economic policies or institutional failures in emerging countries.

As a result, banks' balance sheets are vulnerable to any shock hitting the economy insofar as they suffer from an increasing currency mismatch, a situation in which economic agents have liabilities denominated in foreign currency while their assets are in domestic one [START_REF] Kaminsky | The twin crises: the causes of banking and balance-of-payments problems[END_REF]. Emerging countries with such mismatch are vulnerable to a sudden and large devaluation of their currency against the anchor one. Any devaluation increases the charge of the debt inducing a negative balance sheet effect.

Figure 8 shows that the currency mismatch increased in our sample countries -particularly in economies with fixed exchange rate regimes-while it tends to decline in Latin American South-Eastern countries. In this figure, we use as a proxy of currency mismatch the ratio foreign liabilities to money following the methodology of [START_REF] Yeyati | On the endogeneity of exchange rate regimes[END_REF].

[Insert Figure 8]

The accumulation of external vulnerabilities On the external side, the global financial crisis in developed countries has led to a sharp reversal in capital flows (see below). As Emerging Europe accumulated large external deficits, while other emerging countries reduced their deficit or increased their surplus (figure 9, left side), Emerging Europe was particularly vulnerable to the financial channel. Indeed, current account deficits led Emerging Europe to be dependent on capital inflows to cover them, increasing their vulnerability to a sudden stop in capital flows. Interestingly, the right side of the figure shows that from 2005 peggers countries experienced larger deficits relative to floaters.

[Insert Figure 9]

The composition of net capital inflows in Emerging Europe exacerbates external vulnerability. Figure 10 compares the composition of these inflows in Emerging Europe with other emerging countries. The main lesson of this figure is the high weight of other private financial flows (including banking flows) in the former while in other emerging economies foreign direct investments prevail. However, an extensive literature shows that foreign direct investments are more resilient than other capital flows during crises.

[Insert Figure 10]

As stressed by [START_REF] Balakrishnan | The transmission of financial stress from advanced to emerging economies[END_REF], banking liabilities and portfolio exposures show that Emerging Europe was more vulnerable to external bank crises. In addition, Western European banks had increasingly dominated banking flows. As a result, Western Europe had become the most likely source of common-lender effects. [START_REF] Llaudes | The impact of the great recession on emerging markets[END_REF] and [START_REF] Gallego | The impact of the global economic and financial crisis on Central Eastern and Southeastern Europe (CESEE) and Latin America. Bank of Spain[END_REF] find that pre-crisis current account deficits and the global deleveraging on credit growth have played a critical role, explaining the fact that Emerging Europe has experienced the greatest peak-to-through decline in quarterly real GDP.

The ineffectiveness of monetary policy under fixed exchange rate regimes

Macroeconomic and financial vulnerabilities deliver a clear message: countries having adopted fixed exchange rate regimes encountered important difficulties to respond to massive capital inflows before the global financial crisis.

On the one hand, as stressed above, despite an increasing positive output gap, higher capital inflows, and stronger credit boom, countries with fixed exchange rates had real short term interest rates lower than floaters (see figure 3). In other words, monetary policy has been more loosened in the first group of countries. Indeed, fixed exchange regimes constraint the ability of the central bank to raise its policy rates insofar as raising domestic rates may attract more capital flows and, in turn, induce a pressure on the exchange rate. In accordance with the impossible trinity, authorities cannot attain at the same time (i) a fixed exchange rate, (ii) an independent monetary policy, and (iii) free capital movements. The main point is that, within the context of European integration, many Emerging Europe countries have to ensure open financial account in order to respect rules defined in Copenhagen (the so-called "Copenhagen criteria") to be eligible to join the European Union. Peggers must face a conflict between the external constraint -the fixed exchange rate cannot appreciate-and internal constraints such as the control of domestic credit expansion.

On the other hand, peggers are reluctant to let their currency appreciate to curb capital inflows (figure 11). As a result, they lose a significant degree of freedom in the conduct of economic policy. More specifically, allowing the exchange rate to appreciate tends to slow capital inflows for the following reasons:

-nominal appreciation is equivalent to a tightening of monetary conditions that leads to lower inflation and growth expectations; -as the domestic currency appreciates today, expectations of future appreciations decrease and, in turn, reduce prospective returns.

As a consequence, countries become less attractive for international investors.

From the Global financial crisis to the European sovereign debt crisis

Focusing on the financial channel, one of the main consequences of these shocks has been extremely severe tensions in the banking system. The left side of figure 12 exhibits tension on interbank funding markets while the right side shows the increase in the banking sector CDS spreads. On this figure, we estimate the spreads between the unsecured money market segment (EURIBOR) 5 and the secured money market segment (EUREPO). 6 As expected, we see that during the periods of intense financial stress, the spreads increase as banks lose confidence in their counterparties in the interbank market. The major episode of stress corresponds to Lehman Brothers collapse while the European sovereign debt crisis leads to two episodes, the first beginning in May 2010 with the Greek crisis and the second in 2012 with the contagion to Italy, Portugal, and Spain.

[Insert Figure 12]

The right side of figure 12 portrays the credit default swap spreads for the banking sector in the EU, the United Kingdom, and the United States. A credit default swap is a financial swap agreement in which an agent (the buyer) purchases from a counterparty (the seller) an insurance against the event of default or other credit events The CDS spread represents the premium paid by protection buyer to the seller. Thus, when the probability of default increases, it must result in a spread rise as many agents wish to protect against the occurrence of such defaults. As a result, insofar as the probability of defaults tends to increase during periods of major financial stress, we expect that CDS spreads are a good indicator of financial tensions. Figure 12 shows clearly that it is the case. All banks had been affected by Lehman Brothers collapse explaining the rise in banking sector CDS spreads in both the European Union, the United Kingdom, and the United States. If the European sovereign debt crisis seems to have only a limited impact on British and U.S. banks, figure 12 exhibits a dramatic increase for the European banking sector CDS spreads.

The major consequence of these tensions has been the bank deleveraging process at a worldwide level. Figure 13 exhibits this process for our sample countries. We can see a decrease in the external positions of reporting banks vis-à-vis all sectors in terms of 2013 GDP. The negative shock is particularly large in countries with fixed exchange rate regimes.

[Insert Figure 13]

A second significant consequence of the crisis is the presence of a financial shock transmission -in both directions-between the euro area and Emerging Europe. Figure 14 illustrates this transmission by exhibiting rolling correlations between CDS spreads in Emerging Europe and the European Union.

In figure 14, rolling correlations are portrayed for two financial variables.

The rolling correlation is widely used to assess a model's stability over time. Contrary to the simple statistical correlation analysis, we do not make the assumption that the economic environnement is constant over time. Considering two univariate time series t y 1 and t y 2 over the sample T t 1,... = , the rolling correlation between t y 1 and t y 2 is given by: )

) ( 2, ) ( 1, ) ( 12
) ( ))( ( ( 1 1 = ˆ2 2 1 1 1 0 = ) ( 12, n y n y n t i t t i t n i n t µ µ σ - - Σ - - - - (2)
In this paper, we consider rolling correlation over n =90 days.

[Insert Figure 14]

The left side exhibits the rolling correlation between CDS sovereign debt for our sample

Monetary policy responses to the crisis 8

Interestingly, if many studies have provided new empirical evidence according to which emerging economies tend to adopt more frequently counter-cyclical policies to face crises today relatively to the 1990s' [START_REF] Takáts | Countercyclical policies in emerging markets[END_REF][START_REF] Vegh | Overcoming the fear of free falling: monetary policy graduation in emerging markets[END_REF], Emerging Europe has remained largely out of this new policy framework.

Anecdotal evidences, based on countries experiences, suggest that peggers have been more constrained to respond to the crisis than floaters. [START_REF] Gallego | The impact of the global economic and financial crisis on Central Eastern and Southeastern Europe (CESEE) and Latin America. Bank of Spain[END_REF] show that policy stances differed across Central Eastern and South-Eastern European countries. Indeed, floaters countries tended to reduce their interest rates earlier (2008Q4) than fixers. Corozza et al (2011) consider the experience of South-Eastern European economies. As seen in previous papers, their striking result is that countries with hard pegs (Bosnia-Herzegovina and Montenegro) or conventional peg (Croatia and Macedonia) have been very constrained to use their monetary policy to face the global crisis. Thus, the National Bank of the Republic of Macedonia increased its interest rates in April 2009 (while the inflation rate decreased to zero) and the Croatian National Bank did not change its policy rates during the crisis. In a similar way, in the immediate aftermath of Lehman Brothers collapse, Hungary (and Russia too) increased their policy rates in October 2008 while Estonia and Lithuania did not change them. The Global financial crisis also suggests that countries with more room for lowering interest rates allowed more exchange rate depreciations. [START_REF] Josifidis | Adjustment mechanisms and exchange rate regimes in new 2004 EU members during the financial crisis[END_REF] has analyzed adjustment mechanisms for a sample of transition countries that acceded to the European Union in 2004, but stayed outside the euro area. Over the period 2004-2010, they find that countries with fixed exchange rate regimes have known a weakest real exchange rate adjustment in the aftermath of the Lehman collapse relative to other economies, limiting the ability of exchange rate to smooth negative external shocks.

They also show that, when the real exchange rates change, it is the price level that adjusts in peggers while the nominal exchange rate moves in the floaters. As a result, real exchange rate adjustment tends to be very costly under fixed exchange rate regimes insofar as prices and wages are sticky. [START_REF] Josifidis | Macroeconomic policy responses to financial crises in emerging European economies[END_REF] study monetary policy responses to common financial shocks over the period 1995-2010 for a sample of ten emerging European countries by dividing the sample into two crisis periods (1995Q1-2001Q4 and 2002Q1-2010Q4). On the one hand, they find that common international financial shocks lead to different monetary policy responses. On the other hand, countries with high currency mismatch ratios suffer from both fear of floating and fear of losing international reserves. 9 In other words, if the behavior of the short term interest rates is not significantly different during crisis periods between countries with high or low currency mismatch, it appears that the first group of countries are reluctant to depreciate their currency and / or loose foreign exchange reserves. These results are in line with the recent literature on Latin American countries stressing that the counter-cyclical monetary policy adopted during the Global financial crisis is in part explained by the dramatic decrease in the dollarization degree in the region [START_REF] Cavallo | Policy responses to sudden stops: a comparative analysis, in Dealing with an international credit crunch, policy responses to sudden stops in Latin America[END_REF].

The determinants of short term interest rates in Emerging Europe: the impact of domestic vulnerabilities and international factors

The principal aim of this section is to assess the determination of short term interest rates in our studied countries. More specifically, by identifying the influence of potential determinants of interest rates, we see to what extent central banks are able to conduct an independent monetary policy.

Tested regression

Our dataset covers a time span period of 13 years, from 2001Q1 to 2013Q4, and encompasses the following countries: Bulgaria, Croatia, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, and Serbia.

We test the following regression:

= + + + + + ! "" + # $% '( + ) * $% + + , * . / 0 1 + 2 ( * . / 0 ) (3)
The dependent variable is idom, the money market interest rate for each studied country (for i = 1 to 9) at time t.

i i i i u a x y + + 1 = β (5) where it T t i y T y 1 = 1 = Σ - .
We substract (5) from (4) so as to remove the unobserved effect i a , and we find up with:

i it i it i it u u x x y y - + - - ) ( = 1 β (6) for T t 1,2,... =
, and where i it y yis the time demeaned data on y . This fixed effect transformation is also called the within transformation.

We applied both random effects estimator and fixed effects and test for statistically significant differences in the coefficients on the time varying explanatory variables. We implement the Hausman test. The idea is that one uses the random effect estimates unless the Hausman test rejects them. For both estimation, the Hausman test is rejected.

Results

Results are reported in table 1. Two sets of regression are considered. In the first, we investigate the potential determinants of the short-term interest rate over the whole period 2001Q1-2013Q4 (Column 2). In the second, we focus on the crisis period 2007Q1-2013Q4 so as to explore the potential changes due to the global financial crisis (Column 7).

[Insert Table 1]

The coefficient β1 has the expected positive sign. In other words, a higher inflation rate leads to a rise in short-term interest rate. Such relationship is consistent with a standard Taylor rule.

Interestingly, we see that the value of β1 is lower in the crisis period. This lower coefficient may reflect, on the one hand, the dramatic decrease in inflation after 2010 and, on the other hand, the influence of the Euro area interest rate in the region (see below).

The coefficient relative to the output gap (β2) exhibits opposite signs between the whole period and the crisis period. More specifically, while we obtain a negative sign (-0.23) for the whole period, the sign becomes positive (0.14) during the crisis period. This finding highlights the ability of the studied countries to move towards a more active countercyclical policy in the aftermath of the crisis. The negative value of β2 over the whole period is in line with the finding exhibited in figure 2. Indeed, the monetary policy has been relatively ineffective to respond to positive output gap before the global financial crisis. As stressed above, many of our studied countries have adopted a procyclical monetary policy during this period suggesting that a positive β2 conveys a countercyclical policy. However, the interaction between the output gap and the dummy variable reflecting the adoption of fixed exchange rate regimes (DPeg) leads us to qualify this interpretation. Indeed, if the variable OG.DPeg has an insignificant coefficient (β8) on the whole period, we see that β8 is statistically significant and negative (-0.31) over the crisis period. This result allows us to conclude that fixed exchange rate regimes exert an important constraint on the ability of the monetary policy to respond to negative shocks on the domestic output.

The coefficient concerning the FLM ratio (β3) -used as a proxy of the degree of dollarization or currency mismatch-is insignificant over the whole period. This may mean that dollarization is not an important constraint for monetary policy in tranquil period. In contrast, over the period 2007-2013, not only β3 is positive and statistically significant, but it exhibits a particular high value (0.52). Dollarization is clearly an impediment to conduct a monetary policy devoted to macroeconomic stabilization.

As the economic and financial integration is very high between our studied countries and the Euro area, it is important to see to what extent short term interest rates in the Euro area influence domestic interest rates in Emerging Europe. Table 1 shows that, whatever the considered period, β4 is positive and particularly high (1.04 for the whole period and 0.65 for the crisis period). In other words, the conduct of domestic monetary policy is influenced by the policy adopted in the Euro area. When we interact the Euro area interest rate with the dummy variable DPeg, we find that the Euro area interest rate exerts a stronger influence during the crisis period (0.69 for coefficient β9). In a similar way, using a New Keynesian Phillips curve in an open economy framework, [START_REF] Iossifov | Are non-Euro area EU countries importing low inflation from the Euro area?[END_REF] find that, after controlling for different factors that affect the inflation process, pegger countries have been especially prone to import deflationary pressures from Euro area relative to floaters. As stressed by the authors, countries with flexible exchange rates have been able to benefit from easing cycle of monetary policies that lead to depreciating pressures on their currency.

The last three variables in table 1 are important to consider insofar as they allow us to assess the influence of external financial factors on domestic interest rates.

As the VIX index for the U.S. equity market, the VSTOXX index measures market expectations of near term volatility conveyed by stock index option prices. Since volatility often signifies financial turmoil, VSTOXX index is often referred to as the "investor fear gauge". The VSTOXX index tends to be high during times of financial turmoil and investor fear. During tranquil periods, VSTOXX index levels tend to drop. As a result, this index is an indicator of investor's perception of risk. Table 1 shows that β5 is positive in the two periods without exhibiting a significant increase during the global financial crisis despite the increase in the risk perception in the aftermath of the Lehman Brothers collapse. In fact, figure 15 shows that the VSTOXX index reacts brutally and quickly to specific economic and financial tensions but does not remain at very high levels for a long time period. This behavior may account for our result.

[Insert Figure 15]

In the first section, we highlighted the increasing dependence of our country vis-à-vis external bank financing, particularly from European banks. In this perspective, it is interesting to assess how this dependence influences the determination of short-term interest rates. Table 1 shows that the ratio European banks' consolidated foreign claims of reporting banks over domestic GDP (β6) exerts a positive and significant impact for both periods, and increasing for the global financial crisis, moving from 0.02 to 0.04. This is in line with the stronger financial vulnerability in Emerging Europe relative to other emerging regions.

The variable EMBIG measures yield spreads (over safe or risk free assets that bear minimal credit risk) on emerging market countries' debt instruments. The spread is the extra return required to compensate the investor for the additional risks faced when investing in emerging economies rather than in a safe asset (such as a US government bond). EMBIG measures the sovereign risk. Spreads increase with the deterioration -effective or expected-of fundamentals in the countries issuing bonds; they also increase in periods of international financial strains. As a result, EMBIG is a proxy for market and foreign investor sentiment and it also gauges contagion from global or other emerging markets crisis. As emerging European countries experience significant external vulnerabilities (see section 1), we expect that the coefficient relative to EMBIG (β7) is positive. More specifically, an increase in the EMBIG spread may lead to liquidity strains -e.g. net capital outflows-that are harmful for countries experiencing huge deficit current accounts. Table 1 confirms this relation for the crisis period, but the coefficient is small (0.005).

Overall, our results suggest that domestic and financial vulnerabilities matter to assess the ability of monetary policy to stabilize the economy in response to negative shocks.

Conclusion

This paper has investigated the conduct of monetary policy in a sample of nine emerging European countries over the period 2000-2013. Four findings are particularly important. First, we show that countries with fixed exchange rate regimes have encountered significant obstacles to conduct monetary policy to cope with large capital inflows and credit booms during the period preceding the financial crisis. Second, pegged countries have been more constrained to respond to the global financial crisis than non-pegged economies. Third, countries with high currency mismatch and financial vulnerabilities seem unable to adopt monetary policy dedicated only to macroeconomic stabilization. Finally, we find that interest rate in the Euro area is an important determinant of short term interest rate in our studied countries.

The previous results raise the question of the adoption of the euro. Specifically, it is questionable whether membership in the Euro area could have avoided increasing vulnerabilities observed in 2000-2007. The experience of the peripheral Euro area countries

suggests a negative answer. Indeed, the European Central Bank has not been able to respond efficiently to overheating affecting these countries. Similarly, constraints on exchange rate faced by Southern Euro area countries suggest that they are in a position close enough to the countries outside the euro zone with a high degree of currency mismatch.

End-notes

1 This distinction is based on different de facto classifications. See [START_REF] Bubula | The evolution of exchange rate regimes since 1990: evidence from de facto policies[END_REF], and [START_REF] Reinhart | The modern history of exchange rate arrangements: a reinterpretation[END_REF].

2 Once the zero lower bound is reached, the central banker cannot stimulate aggregate demand or stabilize financial markets through interest rates cuts. In this case, monetary policy becomes "unconventionnal". The central banker is then brought to use nonstandard measures, notably forward guidance, assets buyouts and longer term refinancing operations (but also collateral enlargement, decreases in reserve requirements, fixed rate and full allotment refinancing operations...). See [START_REF] Bernanke | Monetary policy alternatives at the zero bound: an empirical assessment[END_REF].

3 See Appendix 1 for the definition of the output gap.

4 See also [START_REF] Forbes | Capital flow waves: surges, stops, flight, and retrenchment[END_REF]. 5 The Euro Interbank Offered Rate (Euribor) is the average interest rate for unsecured euro term deposits calculated from a panel of more than 30 contributing banks provide daily quotes of the highest rate offered by one prime bank to another for an unsecured euro term deposit. 6 The Europe is the average interest rate for secured money market transactions in the euro area calculated from a panel of contributing banks providing daily quotes of the highest rate on the market offered by one prime bank to another for funds in euro in exchange for certain collateral.

Tables Table 1 Interest Latin America and the Caribbean

  of the monetary policy to Global financial crises Since Lehman Brothers collapse on September 15, 2008, Emerging Europe has been hit by two major shocks: the Global financial crisis from 2008 to 2009 and the European sovereign debt crisis since 2011.

  countries and the weighted CDS sovereign debt for IIPS. Such indicator allows us to see to what extent sovereign debt crisis in the Euro area and crisis in Emerging Europe are interplayed. In the aftermath of Lehman Brothers failure, the correlation remained relatively low as the state of public finance in peripheral Europe was not a major cause for concerns. The situation changed dramatically with the Greek crisis. Two clusters of high correlation (we choose ≥ 0.60 as arbitrary threshold) are identified. The first covers approximatively the period from March 2010 to March 2011. Interestingly, during this period, Granger causality tests suggest that CDS of our sample countries cause IIPS CDS. 7 In other words, the deep recession in most of our studied economies seems to explain part of the increase in expected default of Ireland, Italy, Portugal, and Spain. The second episode refers to the period July 2011-September 2012, a period in which the Greek crisis spillovers to other peripheral European countries. During this period that corresponds to the peak in the European crisis, IIPS CDS Granger causes CDS in Emerging Europe. The right side of figure 14 exhibits rolling correlations between sovereign CDS of our studied countries and CDS of banking sector from the European Union. The correlation between the two variables has been particularly high, and widespread, from May 2010 to November 2010. Except Serbia, all correlations amount at least to 0.60. Granger causality tests show that Baltics, economies are heavily dependent on external banking funds, are influenced by banking sector CDS. Indeed, a significant increase in banking CDS may lead to deleverage pressures on parent banks, then exerting tensions on countries with sizeable external or fiscal financing requirements.

Figure 4

 4 Figure 4 Indicators of credit boom

Figure 5

 5 Figure 5 Financial vulnerabilities increasing in Emerging Europe

Figure 6

 6 Figure 6 External positions of reporting banks vis-à-vis all sectors, March 2007 = 100

Figure 7

 7 Figure 7 Capital flows and credit expansion

Figure 9

 9 Figure 9 Current account balances in percentage of GDP

Figure 10

 10 Figure 10 Private capital flows, net, in U.S. dollars billions

Figure 11

 11 Figure 11 Nominal effective exchange rates, 100 = 2010

Figure 14

 14 Figure 14 Rolling correlations between CDS spreads in Emerging Europe, CDS sovereign debt in IIPS*, and European Union banks CDS

Figure

  Figure15The VSTOXX Index, daily and quarterly data

  rates determinants in Emerging Europe

	Source: authors' estimation.	Variables Constant Inflation [β1] OG [β2] FLM [β3] iecb [β4] VSTOXX [β5] BIS eu [β6] EMBIG [β7]	2001Q1-2013Q4 Coefficients t-student -0.42 0.53 0.74*** 5.83 -0.23*** -2.99 -0.05 -0.12 1.04*** 3.32 0.02** 2.53 0.02*** 2.75 0.001 0.94 Source: authors' estimation. Figure 3 Short-term real interest rates	(p-value) 0.59 0.00 0.00 0.90 0.00 0.01 0.00 0.34	2007Q1-2013Q4 Coefficients t-student -0.29 -0.36 0.17*** 3.31 0.14* 1.74 0.52*** 2.37 0.65*** 5.17 0.05** 2.46 0.04* 1.80 0.005*** 4.40 01/07/2007 Source: IMF, International Financial Statistics. Figure 2 Output gap from 2001 to 2008 -20 -15 01/01/2000 01/07/2000 01/01/2001 01/07/2001 01/01/2002 01/01/2003 01/07/2003 01/01/2004 01/07/2004 01/01/2005 01/07/2005 01/01/2006 01/07/2006 01/01/2007 01/07/2007 01/01/2008 01/07/2008 01/01/2009 01/07/2009 01/01/2010 01/07/2010 01/01/2011 01/07/2011 01/01/2012 01/07/2012 01/01/2013 01/07/2013 Latvia Lithuania Emerging & Developing Economies -15 -10 01/01/2000 01/07/2000 01/01/2001 01/07/2001 01/01/2002 01/07/2002 01/01/2003 01/07/2003 01/01/2004 01/07/2004 01/01/2005 01/07/2005 01/01/2006 01/07/2006 01/01/2007 Romania Emerging & Developing Economies Serbia	-10 Croatia -5 Estonia Advanced Economies Hungary Poland	-5 Bulgaria	(p-value) 0.71 0.00 0.08 0.00 0.00 0.01 0.07 0.00 0 5 10 Advanced Economies 0 5 10	15 15	20 20	25 25	Figure 1 GDP growth in real terms, 2000-2013, percent change	Figures
							01/01/2008
							01/07/2008
		OG.DPeg [β8]	-0.07	-0.95	0.33	-0.31***	-3.71 01/01/2009 01/07/2009 01/01/2010			0.00
							01/07/2010
							01/01/2011
		iecb.DPeg [β9]	-0.45	-0.99	0.32	0.69***	3.77 01/07/2011 01/01/2012			0.00
							01/07/2012
							01/01/2013
							01/07/2013
		Notes: Robust standard errors, *** p<0.01, **p<0.05, * p<0.1

  Figure 8 Ratio of Foreign Liabilities to Money in several emerging countries*, in % * See Appendix 1 for the definition of this variable. Source: authors' estimates. Data extracted from IMF, International Financial Statistics.

	Argentina ARG	Malaysia	MYS
	Brazil	BRA	Mexico	MEX
	Bulgaria	BGR	Peru	PER
	Chile	CHL	Philippines PHL
	Colombia COL	Poland	POL
	Croatia	HRV	Romania	ROM
	Czech Rep. CZE	Russia	RUS
	Estonia	EST	Singapore SGP
	Hungary	HUN Slovakia	SVK
	India	IND	Thailand	THA
	Indonesia IDN	Turkey	TUR
	South Korea KOR	Ukraine	UKR
	Latvia	LVA	Uruguay	URY
	Lithuania	LTU	Venezuela VEN

Banking sector CDS spreads (basis points, daily data)

  Figure 13 Changes in external positions of reporting banks vis-à-vis all sectors, in terms of 2013 GDP Source: authors' estimates. Data extracted from Bank for International Settlements.

	Figure 12 Indicators of banking tensions
	2,5								Tensions on interbank funding markets										600
																																		European Union
																													500				United Kingdom
	2																																	United States
																													400
	1,5																				Spread euribor/eurepo 3 months Spread euribor/eurepo 6			300
																					months
																					Spread euribor/eurepo 1 year
	1																												200
																													100
	0,5
																														0
																													14/12/2007	14/12/2008	14/12/2009		14/12/2010	14/12/2011	14/12/2012	14/12/2013
	0
	01/01/2007 01/01/2008 01/01/2009 01/01/2010 01/01/2011 01/01/2012 01/01/2013 01/01/2014
	Sources: Macrobond and Datastream.
																																				Other private financial flows, net
																																				Private portfolio flows, net
																																				Direct investment, net
	15																					10														Private financial flows, net
								Estonia				Bulgaria				Croatia
																															Hungary			Poland		Romania		Serbia
	10							Latvia					Lithuania							5
	5																					0
																						-5
	-5																					-10
	140 -10														Bulgaria				140	-15
	130														Croatia Estonia				130																Hungary Poland
															Latvia				120																Romania
	110														Lithuania			110																Serbia
	100																				100
	90																				90
	80																				80
	01/01/2004	01/07/2004	01/01/2005	01/07/2005	01/01/2006	01/07/2006	01/01/2007	01/07/2007	01/01/2008	01/07/2008	01/01/2009	01/07/2009	01/01/2010	01/07/2010	01/01/2011	01/07/2011	01/01/2012	01/07/2012	01/01/2013	01/07/2013	01/01/2014	01/01/2004	01/07/2004	01/01/2005	01/07/2005	01/01/2006	01/07/2006	01/01/2007	01/07/2007	01/01/2008	01/07/2008	01/01/2009	01/07/2009	01/01/2010	01/07/2010	01/01/2011	01/07/2011	01/01/2012	01/07/2012	01/01/2013	01/07/2013	01/01/2014

Broadly speaking, a variable X Granger-causes Y if Y can be better predicted using the histories of both X and Y than it can using the history of Y alone.

This subsection draws heavily from Allegret (2012),[START_REF] Josifidis | Adjustment mechanisms and exchange rate regimes in new 2004 EU members during the financial crisis[END_REF] 2014).

Based on fear of losing international reserves behavior, see[START_REF] Aizenman | Exchange market pressure and absorption by international reserves: emerging markets and fear of reserve loss during the 2008-09 crisis[END_REF] and[START_REF] Aizenman | The financial crisis and sizable international reserves depletion: from 'fear of floating' to the 'fear of losing international reserves?[END_REF].

See Appendix 1 for data definitions and sources.


Clara Azémard

Matthieu Ménager

Cathy Vieillescazes
email: vieillescazescathy.vieillescazes@univ-avignon.fr

On the tracks of sandarac, review and chemical analysis

Keywords: Sandarac, Juniper, Origin, Botanic, Chemical composition, GC-MS, Vernice liquida

The sandarac resin (Tetraclinis articulata) has been long used for its properties, mostly as a varnish component. Called juniper resin until the nineteenth century, the real botanical origin of sandarac is still unclear. The first approach to this issue is the review of the evolution of the etymology, terminology, and botanical description of sandarac through time. It seems that sandarac was mainly coming from T. articulata but the use of some juniper resins before the twentieth century is not to be excluded. The second approach is a chemical one; we used gas chromatography coupled to mass spectrometry to characterise the resin. As sandarac was the main component of the famous Italian varnish Vernice liquida, its characterisation is important for old paintings studies. However, although we could hope to differentiate sandarac, Juniperus communis and Juniperus oxycedrus resins by looking at their chemical composition, it appears that these resins are very similar. Besides, we notice a lack of old varnishes containing sandarac which complicates our work.

Introduction

The word sandarac can refer either to an arsenic sulphide mineral, the realgar, or to a resin. This resin, as currently marketed, comes from the Tetraclinis articulata (Bouillon 1770; [START_REF] Mills | Natural resins of art and archaeology their sources, chemistry, and identification[END_REF][START_REF] Langenheim | Plant resins: chemistry, evolution, ecology, and ethnobotany[END_REF]). However, it was formerly referred as BJuniper resin^. The real origin of this resin is the main interrogation of this paper.

Contrary to Pliny's opinion (Pline 1772), this diterpenic resin has good properties and was used for different purposes: medical cares, varnish component, glue (Wagner and Gautier 1878) or calligraphy. In medicine, sandarac (or juniper resin) was used as a drug for different symptoms: burns, pains, nerves illness, diarrhoeas, intestinal worms, and as a haemostatic drug (Matthioli 1566; Dodoens 1557; Charas 1676; Hill 1751; Bastien 1802; Heuzé 1893). It was indeed usually used for nose bleeding but mostly for haemorrhoids and for regulation of the menstruation (Dodoens 1557;Matthioli 1566;[START_REF] Hill | A History of the Materia Medica: Containing Descriptions of All the Substances Used in Medicine[END_REF][START_REF] Bastien | Dictionnaire botanique et pharmaceutique[END_REF]Riddle 1994). It could also be employed in plasters (Charas 1676; Lémery 1732) or mixed with oil to make a cream to prevent hand and feet chap (Dodoens 1557). Although the Europeans stopped using this resin as medicine from the nineteenth century [START_REF] Wilkes | Encyclopaedia Londinensis, Or, Universal Dictionary of Arts, Sciences, and Literature[END_REF][START_REF] Huguet | Dictionary of chemicals and raw products used in the manufacture of paints, colours, varnishes and allied preparations[END_REF], it is still in use in the North of Africa, mostly Morocco (Herlant 1892; [START_REF] Bellakhdar | Repertory of standard herbal drugs in the Moroccan pharmacopoea[END_REF][START_REF] Bastien | La pharmacopée marocaine traditionnelle: médecine arabe ancienne et savoirs populaires[END_REF]. As the realgar was also used as medicine, we can assume from the insistence of various authors on the difference between both sandaracs that some mistakes might have been made, with serious consequences (Dodoens 1557; Matthioli 1566; Felice 1774; Bastien 1802). Powdered sandarac was also used in calligraphy. It was spread (sometimes with a hare foot) to prevent the paper from absorbing ink, improving the quality of writing, hence its designation Bwriters' varnish^or Bsandarac of the writers^by Turquet de Mayerne [START_REF] Savy F Watin | de faire et d'employer le vernis ou l'art du vernisseur[END_REF][START_REF] Montabert | Excitation emission and time-resolved fluorescence spectroscopy of selected varnishes used in historical musical instruments[END_REF][START_REF] De Mayerne | Pictoria, sculptoria et quae subalternarum artium: 1620 le manuscrit[END_REF][START_REF] Mayer | Traditional artists' varnishes[END_REF][START_REF] Perego | Histoire naturelle des drogues simples: ou, Cours d'histoire naturelle professé à l'École de pharmacie de Paris. J.-B. Baillière et fils, Paris Pline l'Ancient[END_REF]Buonanni and Perugini Responsible editor: Michel Sablier Electronic supplementary material The online version of this article (https://doi.org/10.1007/s11356-017-0522-0) contains supplementary material, which is available to authorized users.

2009

). It gave back uniformity to scratched paper by filling the gaps and was known as Bpounce^in England [START_REF] Hill | A History of the Materia Medica: Containing Descriptions of All the Substances Used in Medicine[END_REF][START_REF] Duplessy | Des végétaux résineux, tant indigenes qu'exotiques; ou description complete des arbres, arbrisseaux, arbustes et plantes qui produisent des resines; avec les procedes pour les extraire; l'indication detaillee de leurs proprietes et usages dans la medecine, la pharmacie, l'art veterinaire, la peinture, les vernis, la teinture, la parfumerie[END_REF][START_REF] Wilkes | Encyclopaedia Londinensis, Or, Universal Dictionary of Arts, Sciences, and Literature[END_REF]. However, sandarac is best known as one of the first varnishes component. That is why the name Bvernix^was used in France and trades (Dodoens 1557;[START_REF] Kearsley | Traité théorique et pratique sur l'art de faire les vernis: suivi de deux mémoires, l'un sur les dangers qui menacent les peintures vernies d'extérieurs[END_REF]Herlant 1892). The first evidence in the literature of its use in varnishes dates back the twelfth century (Theophilius 1843). This resin became particularly important during the 15th-16th centuries (Eastlake 2001) with the success of the vernice liquida, a famous Italian oil varnish. Otherwise, sandarac was mostly used as an alcoholic varnish and, afterward, as a spirit varnish despite its coloration with ageing [START_REF] Savy F Watin | de faire et d'employer le vernis ou l'art du vernisseur[END_REF][START_REF] Kearsley | Traité théorique et pratique sur l'art de faire les vernis: suivi de deux mémoires, l'un sur les dangers qui menacent les peintures vernies d'extérieurs[END_REF]Hurst 1901). Nowadays, sandarac varnishes are mostly used on wood and no more on paintings [START_REF] Duplessy | Des végétaux résineux, tant indigenes qu'exotiques; ou description complete des arbres, arbrisseaux, arbustes et plantes qui produisent des resines; avec les procedes pour les extraire; l'indication detaillee de leurs proprietes et usages dans la medecine, la pharmacie, l'art veterinaire, la peinture, les vernis, la teinture, la parfumerie[END_REF].

In term of chemistry, the sandarac resin coming from T. articulata has been studied various times and is composed of approximately 80% of sandaracopimaric acid, 10% of callistric acid and 2% of sandaracinic acid [START_REF] Thoury | Identification Non-Destructive Des Vernis Des Oeuvres D'art Par Fluorescence UV[END_REF]. Different phenols (totarol, ferruginol and manool) or various labdanes as agathic acid can also be present [START_REF] Mills | Organic chemistry of museum objects[END_REF][START_REF] Scalarone | Ageing behaviour and analytical pyrolysis characterisation of diterpenic resins used as art Environ Sci Pollut Res Author's personal copy materials: Manila copal and sandarac[END_REF][START_REF] Perego | Histoire naturelle des drogues simples: ou, Cours d'histoire naturelle professé à l'École de pharmacie de Paris. J.-B. Baillière et fils, Paris Pline l'Ancient[END_REF][START_REF] Andreotti | dans lequel on traite méthodiquement des différens êtres de la nature, considérés soit en eux-mêmes d'après l'état actuel de nos connoissances, soit relativement a l'utilitè qu'en peuvent retirer la médecine, l'agriculture, le commerce et les artes. Suivi d'une biographie des plus célèbres naturalistes[END_REF][START_REF] Romero-Noguera | Analytical characterisation of the biodeterioration of diterpenoid labdanic varnishes used in pictorial techniques: sandarac and Manila copal[END_REF]. Besides, sandarac possesses a polymeric fraction composed of polycommunic acid [START_REF] Scalarone | Ageing behaviour and analytical pyrolysis characterisation of diterpenic resins used as art Environ Sci Pollut Res Author's personal copy materials: Manila copal and sandarac[END_REF]Colombini and Modugno 2009). Many differences in the composition are observed in the literature; the origin of the resin and the time of storage could influence the relative composition [START_REF] Busson | Qualitative and quantitative studies of chemical composition of sandarac resin by GC-MS[END_REF]. The principal compounds of sandarac have been determined by highperformance liquid chromatography (HPLC) [START_REF] Sugimoto | Identification of the main constituents in sandarac resin, a natural gum base[END_REF]) but mostly by gas chromatography coupled to mass spectrometry (GC-MS) (van den Berg 2002; [START_REF] Scalarone | Ageing behaviour and analytical pyrolysis characterisation of diterpenic resins used as art Environ Sci Pollut Res Author's personal copy materials: Manila copal and sandarac[END_REF][START_REF] Osete-Cortina | Analytical characterization of diterpenoid resins present in pictorial varnishes using pyrolysis-gas chromatography-mass spectrometry with on line trimethylsilylation[END_REF][START_REF] Andreotti | dans lequel on traite méthodiquement des différens êtres de la nature, considérés soit en eux-mêmes d'après l'état actuel de nos connoissances, soit relativement a l'utilitè qu'en peuvent retirer la médecine, l'agriculture, le commerce et les artes. Suivi d'une biographie des plus célèbres naturalistes[END_REF][START_REF] Thoury | Identification Non-Destructive Des Vernis Des Oeuvres D'art Par Fluorescence UV[END_REF][START_REF] Romero-Noguera | Analytical characterisation of the biodeterioration of diterpenoid labdanic varnishes used in pictorial techniques: sandarac and Manila copal[END_REF]. Some analysis by fluorimetry [START_REF] Thoury | Identification Non-Destructive Des Vernis Des Oeuvres D'art Par Fluorescence UV[END_REF][START_REF] Thoury | Identification Non-Destructive Des Vernis Des Oeuvres D'art Par Fluorescence UV[END_REF][START_REF] Montabert | Excitation emission and time-resolved fluorescence spectroscopy of selected varnishes used in historical musical instruments[END_REF], infrared or Raman spectroscopies (Derrick et al. 1999;Daher et al. 2010;[START_REF] Prati | Application of ATR-far-infrared spectroscopy to the analysis of natural resins[END_REF]Azémard et al. 2014) also enabled to characterise this resin.

Despite being described in various ancient manuscripts, the origin of sandarac in ancient times is still a source of uncertainty. The evolution of the terminology, and mostly its botanical attribution in the Cupressaceae family through time, is a real issue we try to clarify in the first part of this study. In the second part, we will focus on sandarac chemical composition and its use in old masters varnishes to try to get a better understanding of which trees produced what was then called BArabian sandarac^.

Terminology

To understand where sandarac resin comes from, it is necessary to find the first times it is mentioned and follow its tracks to nowadays. To do so, it must be considered that sandarac can appear under different names that we will try to explain: sandarac and various derivates (sandarach, sandaracha, sandarus, sandarax, Arabian sandarac), vernix, gum juniper, juniper resin, gum sandarach, sandaracha Arabum. It is particularly interesting to focus on the evolution of the botanical origin given to this resin.

Etymology

Until at least the sixteenth century, various words were used to designate sandarac. Greeks called it χομμι άρκεντιδος (or κομμί άρκοιδος (Felice 1774)), and in Latin Gummi iuniperi linked it to juniper tree. The Arabians called it sandarax or sandarus and the Barbarian sandaracha whereas French used the term vernix, also employed in the shops according to Dodoens (1557). It was also called El grassa or grasilla by the Spanish and sometimes in Morocco [START_REF] Merrifield | Medieval and Renaissance treatises on the arts of painting: original texts with English translations[END_REF].

Vernix comes from the Greek βερενικη, formerly Electrum referring to the karabe resin. The use of this term is well explained by the fact that amber, karabe and sandarac were considered as very similar by Middle Age authors, as it was mentioned by Avicenna (Persian polymath, 980-1037) and also Serapion the younger (12th-13th c.) [START_REF] James | Dictionnaire universel de medecine, de chirurgie, de chymie, de botanique[END_REF]. Another etymological origin proposed for the term varnish is the Latin word vernum, meaning spring, because it corresponds to the season when the resin is collected [START_REF] Lémery | Traité universel des drogues simples, mises en ordre alphabétique: ouvrage dépendant de la pharmacopée universelle[END_REF]Buonanni and Perugini 2009).

Sandarac also comes from the Greek σανδαράχη. This term designates a red arsenic sulphide, the realgar but is apparently also used for the erithace (bee-bread) by Pline the Elder (XI,7) among others [START_REF] Hill | A History of the Materia Medica: Containing Descriptions of All the Substances Used in Medicine[END_REF][START_REF] De Felice | Encyclopédie ou Dictionnaire universel raisonné des connoissances humaines[END_REF]Pline 1848). It is explained by its similarity with the glue extracted from the gum of the tree. This glue is said better when strongly red. From this definition, the Arabian may have taken the name ن ﺪ و , (sandarūs). For them, the issue of differentiation with realgar is inexistent as they name this mineral zarnig. When translated in Latin alphabet, the [u] became [a] as it often happens according to the author, hence the words sandarax, sandarach and sandarac (Matthioli 1566; James 1746).

To avoid the use of the wrong material (mostly for medical care), an epithet is often added before, Grecian/Arabian, or after, Graecorum/Arabum, the name sandarac (Alexandre 1759; Anonymous 1770; Lemery and Morelot 1807; Wilkes 1827).

Evolution of terminology linked to the botanical attribution

Though only a few texts mentioning sandarac are found during Middle Age, it seems it already has an important role in art and medicine. As said before, Arabian authors between the Environ Sci Pollut Res tenth and the thirteenth centuries mentioned sandarac as medicine and a resin close to amber and karabe [START_REF] James | Dictionnaire universel de medecine, de chirurgie, de chymie, de botanique[END_REF]. The monk Theophilius in his manuscript Diversarum artium schedula (twelfth century) mentions the use of vernix to make varnishes but no botanical origin is given (Theophilius 1843). Jacobus de Tholeto in 1440 is more precise BS. 206. To make liquid varnish: Take of the gum of the juniper (sandarac) two parts, and one part of linseed-oil^ (Tholeto 1906).

Until the nineteenth century, sandarac has always been described as juniper resin in dictionaries or science books ( Dodoens 1557; Matthioli 1566; Pomet 1694; Lémery 1732; James 1746; Hill 1751; Diderot andd'Alembert 1765 Hill 1751; Bouillon 1770). In the shops, both resins were likely to be mixed [START_REF] Hill | A History of the Materia Medica: Containing Descriptions of All the Substances Used in Medicine[END_REF]). Juniperus arbour is in fact the tree form of Juniperus communis that is said to be as tall as 20 ft in some regions. The shrub species of Juniper found in Europe also give sandarac but in so small quantities that they were not exploited (Pomet 1694).

At the end of the eighteenth century, the economic policy of Mohammed III generated the creation of new consulate in North Africa where various botanists travelled or went working. They made inventories of plants and trees found in Algeria and Morocco at that time, enabling a better knowledge of botanical species in that region. Thomas Shaw, a chaplain in Alger, was the first to describe a tree that he named Cypressus fructu quadrivalvi, Equiseti instar articulates (Tilloch 1799). He was followed by P.K.A. Schousboë, general consul of Denmark who lived in Mogador and then Tangier between 1791 and 1832, and who described the same tree and classified it as a thuya. Unluckily, his book on Morocco's flora Iagttagelser over Vextrigeti Marokko was left unfinished and translated in German in 1801 only (Cosson 1881). This thuya (thuja, thuia in some texts) was finally first described and classified by Martin Vahl, a Danish botanish, student of Linné, in Symboloe botanicoe (Part II, p96, plate XLVIII) after his trip in Tunisia in 1783 (Cosson 1881).

In 1799, Schousboë reported that J. communis does not grow in the Atlas mountains and makes the link between sandarac and thuya. The article published in a Danish journal leads to another one, in English this time, in the Philosophical Magazine, under the name BOn the real origin of that resin known under the name of sandarac, and that of gum Arabic^ [START_REF] Tilloch | Philosophical Magazine[END_REF]. It is noticeable that the statement concerning J. communis is not completely true as this species is rare but not absent and that other species of Juniperus such as the J. oxycedrus are also present in this region [START_REF] Quezel | Genévrier[END_REF].

Around the same time, two French botanists, P.M.A. Broussonet, exiled after the revolution then consul in Mogador, and R.L. Desfontaine, member of the science academy and professor at the National Museum of Natural Sciences, reached the same conclusion. They published it in Flora Alantica (1798-1800) and that lead to a pharmaceutical Codex in 1818 on J. communis: BEx hujus aut congeneris africanoe cortice,(an potiùs ex thuyà articulatà, testante Broussonnet et memorante Desf ontaines?) fluit Sandaracha^(Anonymous 1818).

Thuya genre was already known, sometimes called tree of life, and it may seem strange that nobody found out before that it was the real sandarac tree. However, it must be pointed out that those trees are very similar to a profane and that botanists may not have known the use of the tree.

During the nineteenth century, the identity of sandarac stayed in a state of confusion for part of the scientists and artists. Some ). Indeed, J. communis and J. oxycedrus are still described as a possible origin of sandarac. Dictionaries are being for many people the reference; it seems more obvious why the resin stayed attributed to Juniperus so long after its new attribution.

At the end of the nineteenth century, M.T. Masters, an English botanist, gives a new botanical name corresponding to the description of Vahl: Tetraclinis articulata. It is the official name nowadays, even if the appellations Callistris quadrivalvis and Thuya articulata are also accepted. From the twentieth century, sandarac is no more described as coming from juniper (Dieterich 1920;de Tarde 1922;Anonymous 1927;[START_REF] Perugini | Histoire des plantes en laquelle est contenue la description entiere des herbes... non seulement de celles qui croissent en ce païs, mais aussi des autres estrangères qui viennent en usage de médecine[END_REF][START_REF] Langenheim | Plant resins: chemistry, evolution, ecology, and ethnobotany[END_REF].

After the colonisation of North Africa, more information can be found on the exploitation of sandarac. Apparently, the Environ Sci Pollut Res forests of Arar (Arabic name) represented a high value and occupy 200,000 ha in Morocco, despite of the forests being removed by fire in the regions where agricultural production was possible (Anonymous 1927). In the first half of the twentieth century, Morocco was the first producer of sandarac followed by Tunisia. They exported the resin to Europe and USA [START_REF] Perugini | Histoire des plantes en laquelle est contenue la description entiere des herbes... non seulement de celles qui croissent en ce païs, mais aussi des autres estrangères qui viennent en usage de médecine[END_REF]). Yet, the forests were poorly exploited and without precautions for the tree (Anonymous 1927). Nowadays, sandarac still comes from Morocco but in smaller amount than before due to the creation of turpentine spirit and synthetic varnishes.

We can conclude that the confusion on the sandarac origin comes mostly from a bad botanic knowledge during the Middle Age. Sandarac most probably came from T. articulata resin and could have been mixed with J. oxycedrus resin, at least for a time. Chemical analysis of old varnish could tell us about the true origin of some sandarac.

Chemistry Resin analysis

Sandarac

Sandarac resin was analysed using GC-MS(/MS) after methylation and trimethylsilylation (see BMaterial and methodsŝ ection). The analysed fraction of sandarac is composed of various pimaranes and labdanes, as well as some phenols (Table 1). The identification was made thanks to the literature and the study of the path of fragmentation in MS and MS/MS [START_REF] Azemard | Analysis of diterpenic compounds by GC-MS/MS: contribution to the identification of main conifer resins[END_REF]). The different derivation procedures lead to strong variations of the relative intensities of various compounds: (i) the cis-and trans-communic acids induces a high signal after the methylation (data not shown), and a weak one after the trimethylsilylation (Fig. 1) and (ii) the 3hydroxy-eperuique acid is absent of methylated samples. Consequently, it can be very interesting to analyse this resin with both methods of derivatisation. Sandarac varnishes suffer photoageing degradation processes that tend to reduce strongly the proportion of free terpenes. Indeed, the communic acids polymerize forming polycommunic acid. The cross-linking fraction increases with the exposure to light while the amount of communic acids strongly decreases until it is completely transformed [START_REF] Scalarone | Ageing behaviour and analytical pyrolysis characterisation of diterpenic resins used as art Environ Sci Pollut Res Author's personal copy materials: Manila copal and sandarac[END_REF][START_REF] Osete-Cortina | Analytical characterization of diterpenoid resins present in pictorial varnishes using pyrolysis-gas chromatography-mass spectrometry with on line trimethylsilylation[END_REF], Colombini and Modugno 2009). Besides, Scalarone et al. observed that the free diterpenes also decrease after photodegradation, probably due to cross-linking or/and the formation of diterpenes, undetectable by GC-MS (2003). This decrease of identifiable molecules makes even harder the identification of the resins after ageing.

Juniper

Some resin was collected on J. communis and J. oxycedrus in the south of France to be compared by GC-MS with T. articulata resin. Mills and White already pointed out that polycommunic acid is present in Juniperus resin [START_REF] Mills | Organic chemistry of museum objects[END_REF]. The chromatographs clearly show a strong similarity between sandarac and J. oxycedrus resin: the major peaks are in this order: 3-hydroxy-eperuic, hydroxysandaracopimaric and sandaracopimaric acids. We can also observed various other acids and two phenols: sugiol and ferruginal (Fig. 1). The resin coming from J. communis shows slight differences with a much smaller peak of hydroxysandaracopimaric acid and an intense peak of sugiol that may enable to differentiate this resin from the two others. However, as said before, differences can also be observed between trees of the same species but with different environment. [START_REF] Busson | Qualitative and quantitative studies of chemical composition of sandarac resin by GC-MS[END_REF] showed a qualitative similarity between sandarac from different suppliers but quantitative differences. Therefore, the identification of J. communis must be done with precautions. Besides, as the three species share the same composition, aged resins are most probably also very similar. The identification of the species used for ancient sandarac remains complex even with analytical techniques.

Sandarac varnishes

Old recipes

Sandarac resin has been used in numerous recipes of varnishes since Middle Age. Those recipes can be divided in two groups: alcoholic varnishes and oil varnishes. Sandarac is well soluble in alcohol and was often used to make a bright, transparent varnish. Many recipes can be found for paintings and wood (Bouillon 1770;[START_REF] Savy F Watin | de faire et d'employer le vernis ou l'art du vernisseur[END_REF]Tingry 1804;[START_REF] Montabert | Excitation emission and time-resolved fluorescence spectroscopy of selected varnishes used in historical musical instruments[END_REF]Anonymous 1849a;[START_REF] Armenini | Effect of Photodegradation on the identification of natural varnishes by FT-IR spectroscopy[END_REF]Buonanni and Perugini 2009) (Supplementary information). Sandarac is the basis of many alcoholic varnishes, but it tends to give brittleness to the varnish. To avoid this defect, it is often mixed with elemi, gum anima or shellac [START_REF] Duplessy | Des végétaux résineux, tant indigenes qu'exotiques; ou description complete des arbres, arbrisseaux, arbustes et plantes qui produisent des resines; avec les procedes pour les extraire; l'indication detaillee de leurs proprietes et usages dans la medecine, la pharmacie, l'art veterinaire, la peinture, les vernis, la teinture, la parfumerie[END_REF]Tingry 1804;[START_REF] Montabert | Excitation emission and time-resolved fluorescence spectroscopy of selected varnishes used in historical musical instruments[END_REF][START_REF] Kearsley | Traité théorique et pratique sur l'art de faire les vernis: suivi de deux mémoires, l'un sur les dangers qui menacent les peintures vernies d'extérieurs[END_REF]Buonanni and Perugini 2009). Alcoholic varnishes are no longer used for paintings as spirit varnishes made with turpentine spirit are preferred.

Oil varnishes are mentioned from the eigth to the ninth century in Lucques' manuscript, but their existence is most probably older [START_REF] Perego | Histoire naturelle des drogues simples: ou, Cours d'histoire naturelle professé à l'École de pharmacie de Paris. J.-B. Baillière et fils, Paris Pline l'Ancient[END_REF]. The choice of the oil is of first importance when making varnishes. The oil has to be colourless, siccative and odourless. Although the oil varnishes are more flexible and less brittle than alcoholic varnishes, they need a longer time to dry and are more coloured (McIntosh 1908;[START_REF] Perego | Histoire naturelle des drogues simples: ou, Cours d'histoire naturelle professé à l'École de pharmacie de Paris. J.-B. Baillière et fils, Paris Pline l'Ancient[END_REF]. Sandarac is hardly soluble in most oils;

Environ Sci Pollut Res some authors even consider it is only entirely soluble in aspic oil (oil of spike lavender) (Charas 1676; Pomet 1694). However, according to the old recipes found in the literature (see Supplementary material), this resin was often used mixed with linseed oil, to make a famous varnish that the Italian called vernice liquida. This varnish, considered for a long time as the best varnish for paintings, was mentioned by Leonardo da Vinci (da Vinci and Chastel 2003) and may have been the ,256,241,187,161,159,133,121,256,241,200,161,148,134,119,105, This system with two pots, one on the top of the other, is also used by Jehan le Begue in his manuscript (1431, recipe 31) to make an « aromatic glassa » varnish (probably copal or amber) (Le Bègue 1849). Indeed, as the sandarac is soluble, the artists probably used various techniques to enhance solubility. Some incorporate the powdered resin to boiling hot oil and continue the ebullition for a moment (Anonymous 1849b, c; Eastlake 2001); others heat separately the resin and the oil and when the resin is almost completely melted and fluid, the oil is incorporated (Eastlake 2001;[START_REF] Sabin | The industrial and artistic technology of paint and varnish[END_REF]. Another technique is to use additives such as turpentine spirit, mordant, and other resins [START_REF] Merrifield | Medieval and Renaissance treatises on the arts of painting: original texts with English translations[END_REF]Buonanni and Perugini 2009). According Fioravanti, if the oil is not cooked, the resin shall burn. Besides, he indicates to let the oil cool down before adding the resin (Buonanni and Perugini 2009). We tried several times to make vernice liquida from linseed oil and sandarac only; the dissolution was scarce and the final solution yellow-brownish. Besides, precautions must be taken when making this varnish; indeed, the oil tends to ignite when the temperature is too high. It is probable that the recipes are lacking some precision (temperature) on purpose to keep the secret of the masters, or that they were made only as to remember the principal components but that in reality additives were used, enabling the dissolution. The violinmaker Koen Padding had apparently sold an oil varnish on BMagister Varnish Products^composed of oil and sandarac and called Vernice liquida commune. Unfortunately, he died in 2012 leaving no recipe for this varnish, whose analyses done by FTIR only gave a 20% in ratio of resin, probably sandarac but possibly mixed with other resins according to Helen Michetschläger (Michetschläger 2015; Lynch 2016).

Analysis of varnish samples

With the apparition of turpentine spirit-based varnishes at the end of the eighteenth century, and later of dammar resin, an interesting alternative to mastic, the sandarac varnishes lost their popularity. They are now only used for wood (particularly lute-making). However, looking at the numerous recipes involving sandarac, it seems legitimate to find some sandarac varnishes on ancient artworks, wooden furniture or instruments. In 4 years, we had the chance to analyse 19 painting varnishes and two wood varnishes (see Supplementary material). We hoped to find sandarac in at least one of the older samples but even the wood varnishes did not reveal any trace of this resin (Azémard 2014). Looking at the literature, sandarac is in fact only rarely found on artworks. A few Cupressaceae resin was found on National Gallery's paintings. It is the case of the study of a panel by Carlo Crivelli and of a Virgin and Child (Albrecht Durer?). However, the authors precise it is not possible to tell if Tetraclinis or Juniperus resin was used (Dunkerton and White 2000; [START_REF] Ackroyd | AVirgin and Child from the Workshop of Albrecht Dürer?[END_REF]. Sandarac was also identified on an Irish Harp dating around 1825 [START_REF] Mills | Natural resins of art and archaeology their sources, chemistry, and identification[END_REF].

The major reason of the lack of old samples with sandarac is most probably the campaign of cleaning of paintings that occurred during the eighteenth and nineteenth centuries. Old varnishes were removed and new ones, without sandarac, applied. Besides, the polymeric fraction forming during ageing is harder to remove.

Furthermore, the ancient recipes may not have been always followed. Indeed, as shown by [START_REF] Mathias | Dictionnaire raisonné, universel d'histoire naturelle: Contenant l'histoire des animaux, des végétaux et des minéraux, et celle des corps célestes, des météores, et des autres principaux phénomenes de la nature; avec l'histoire des trois règnes, et ... une table concordante des noms latins[END_REF], it seems for example that the Monks of the Mount Athos preferred to use colophony, a resin easily soluble in oil resin than sandarac to varnish their Byzantine icons in contradiction with Dionysios of Fourna writings. It is also clear that the resin sold under the name of sandarac was not always sandarac. As said before, resins from different trees (thuya and junipers) were mixed, and Tingry warns against forgeries in the shops that may have been common at that time (1804).

Conclusion

The sandarac resin was apparently produced mostly by Tetraclinis articulata tree, growing in the North of Africa. Juniperus oxycedrus resin might have also been used and sold as sandarac. The name juniper gum seems to come only from a lack of botanical knowledge and the confusion between close genres of the Cupressaceae family. Even chemically, Tetraclinis and Juniperus are really similar; the possibility of discriminating those resins in their fresh and aged states is reduced. However, the principal issue is to find old sandarac varnishes. Indeed, most of them have been removed long ago, Environ Sci Pollut Res and the others are much degraded or are hardly removable, which complicates the identification.

Material and methods

Sandarac resin was purchased at EMIGA S.A. Both juniper resins were collected on the summer 2012 in the south of France: Juniperus communis resin was collected in Aulusles-Bains (Ariège) and Juniperus oxycedrus in Tautavel (Pyrénées Orientales). All samples were trimethylsilylated before injection, with BSTFA +1%TMCS (30 min, 70 °C) or methylated with TMSH (30 min, 70 °C). For the artificial ageing, the resins were dissolved in ethanol and spread on a microscope slide then aged under artificial sunlight (SUNTEST CPS+, Atlas) during at least 300 h under the following conditions: 35 °C and 765 W/m 2 .

The analyses were performed on a Thermo Fisher Focus GC coupled to an ion trap ITQ 700 mass spectrometer. We used Excalibur software to treat our data. The analyses were carried out under a helium flux of 1.2 ml/min. The injector and the ion source temperatures were set at 250 °C and the transfer line at 300 °C. All analyses were done with two different sets of electron energy/lens tension (i) 70 eV/10 V, the usual ones, also used for the MS/MS experiments and (ii) 17 eV/ 50 V, in order to always get the mass weight and have a better vision of some fragmentations. For both parameters, the emission current was 250 μA. MS/MS experiments were carried out as complementary analyses on the major peaks of the different molecules mass spectra.

  authors preferred to put both origins (Lens and Mérat 1831; Planchon 1869; Cameron 1886; Heuzé 1893; Hurst 1901), others Thuya articulata or Callitris articulata (Anonymous 1829; Cuvier 1829; Herlant 1892) and others kept to the Juniperus attribution (mostly in the first part of the nineteenth century) (Duplessy 1802; Malisset 1803; Tingry 1804; Lemery and Morelot 1807; Wilkes 1827; Lens and Mérat 1831). The definition of sandarac in the Dictionnaire des sciences médicales (Medical sciences dictionary) in 1820 (Anonymous 1820) contributed to a polemic and tense exchanges between specialists as it appears in the Journal de pharmacie et des sciences accessoires (Journal of pharmacy and ancillary sciences) in 1820 (Bouillon-Lagrange et al. 1820; d'Hortes 1820

Fig. 1

 1 Fig. 1 Chromatograms of a) Tetraclinis articulata, b) Juniperus oxycedrus, and c) Juniperus communis resins after trimethylsilylation

  ; Anonymous 1770; Bouillon 1770; Felice 1774; Valmont-Bomare 1800; Duplessy 1802) as well as books on art techniques (Delormois 1771; Watin 1772; Anonymous 1849a; Matthioli 1906; Mayerne 1977; Anonymous 1999; Buonanni and Perugini 2009). Mostly the English, the Swedish and the Hambourgeois (Pomet 1694) traded sandarac. It could be called Mogador sandarac because the ships bringing the resin to London and Marseille sailed from Morocco, and more particularly Mogador (Essaouira) port (Hurst 1901). It was believed that the best sandarac came from the prickly cedar or cedrus bacciferus (now classified Juniperus oxycedrus) but it is rare so most of the production came in reality from the Juniperus arbour in Africa (Matthioli 1566; Pomet 1694; Lémery 1732; Quincy and Clausier 1749;

Table 1

 1 Principal molecules identified in fresh sandarac resin after trimethylsilylation (t R time of retention, Mw molecular weight)

	t R (min) Mw Other peaks	Attribution
	22.65	275	257, 187, 177, 122, 95, 79	Manoyl oxide
	25.98	358	343, 301, 273, 261, 247	Ferruginol
	26.44	374	359

  Byzantine icons (Vieillescazes et al. 2005). The ordinary recipe of vernice liquida consists in two or three parts of linseed oil (sometimes nut oil) for one part of sandarac. This varnish is frequently mentioned and many recipes of vernice liquida and other oil varnishes made with sandarac can be found in old art manuscripts from the twelfth to the nineteenth Heat separately the oil and the resin. The resin is put in a close pot, with a second pot with its bottom perforated embed on the first one, the whole thing with stirring; (ii) when the resin is melted, add the oil; (iii) heat the mixture, but do not let it boil and (iv) remove from the heat and let cool down.

	Environ Sci Pollut Res
	27.11 one used for century (Borghini 1730; Delormois 1771; Theophilius 374 359, 346, 257, 241, 145, 121, 105	acid Sandaracopimaric acid
	27.32 1843;Anonymous 1849b, c; Sabin 1906; Eastlake 374 359, 256,241, 227	Isopimaric acid
	31.06 2001;Buonanni and Perugini 2009) (Supplementary material). 372 357, 315, 275, 235	Sugiol
	31.35 Merrifield in her book reuniting various manuscripts reviews 466 451, 376, 348, 258, 161, 121, 73	3-hydroxy-eperuic acid
	32.35 some of the different recipes and denominations of vernice 464 449, 374, 359, 269, 256, 241, 189, 147, 105, 73	Hydroxy-sandaracopimaric
	liquida (chap.VI) (1849). The oldest is the Formula of	acid
	33.29 Theophilus (Theophilius 1843): (i) Put linseed oil and sanda-480 465, 447, 362, 347, 272, 255, 239, 175, 161, 121, 73	Pinifolic acid
	33.42 rac finely ground in a container and (ii) heat without boiling 478 463, 360, 346, 307, 271, 253, 227, 189, 121, 73	Isoagathic acid
	35.23 until one-third is evaporated. Another more detailed recipe 478 463, 373, 360, 346, 307, 271, 253, 229, 213, 189, 121, 73 Agathic acid
	with two thirds of oil and one third of resin (in weight) is
	proposed: (i)

Acknowledgements The authors would like to express their gratitude to all the conservators-restorers who collected varnishes samples, especially Thierry Martel for trying to make vernice liquida in his workshop. Many thanks to Caroline Hudry who helped collecting Juniperus oxycedrus resin.