Growth Recovery in Southern Europe : A Dozen Lessons, Old and New

Greece, Ireland, Portugal, and Spain entered a period of severe economic and financial stress in the aftermath of the 2008 crisis. Their collective experience confirmed the primacy of total debt, private or public, in affecting the onset of, depth...

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Main Author: Islam, Roumeen
Format: Working Paper
Language:English
en_US
Published: World Bank, Washington, DC 2016
Subjects:
Online Access:http://documents.worldbank.org/curated/en/886151478108905259/Growth-recovery-in-southern-Europe-a-dozen-lessons-old-and-new
http://hdl.handle.net/10986/25677
id okr-10986-25677
recordtype oai_dc
spelling okr-10986-256772021-06-10T09:02:07Z Growth Recovery in Southern Europe : A Dozen Lessons, Old and New Islam, Roumeen economic growth economic recovery debt crisis financial crisis financial markets fiscal expansion fiscal consolidation monetary policy stabilization distributional effects labor markets unemployment Greece, Ireland, Portugal, and Spain entered a period of severe economic and financial stress in the aftermath of the 2008 crisis. Their collective experience confirmed the primacy of total debt, private or public, in affecting the onset of, depth of, and recovery from economic crises. The year 2010 and the years following have demonstrated the ways in which policy responses to crisis-related downturns must be adapted when major international partners experience simultaneous growth slowdowns and markets exhibit increased risk aversion. This paper compares the recovery experience of these countries in light of recent policy debates and research on the impact of macroeconomic and structural reforms. It highlights that (a) the quality of the policies adopted to stabilize economies in the short run affects growth recovery in the long run; and (b) macroeconomic policies (fiscal and monetary) are most effective in supporting growth when they take into account structural differences between countries and when policies complement each other. The country experiences indicate that a holistic view of factors affecting investment, exports, and employment is needed to understand the impact of macroeconomic and structural reforms on output. In the absence of such a holistic view, policy may neglect to influence the binding constraints to growth. 2016-12-05T23:19:23Z 2016-12-05T23:19:23Z 2016-11 Working Paper http://documents.worldbank.org/curated/en/886151478108905259/Growth-recovery-in-southern-Europe-a-dozen-lessons-old-and-new http://hdl.handle.net/10986/25677 English en_US Policy Research Working Paper;No. 7877 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Europe and Central Asia Eastern Europe
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
en_US
topic economic growth
economic recovery
debt crisis
financial crisis
financial markets
fiscal expansion
fiscal consolidation
monetary policy
stabilization
distributional effects
labor markets
unemployment
spellingShingle economic growth
economic recovery
debt crisis
financial crisis
financial markets
fiscal expansion
fiscal consolidation
monetary policy
stabilization
distributional effects
labor markets
unemployment
Islam, Roumeen
Growth Recovery in Southern Europe : A Dozen Lessons, Old and New
geographic_facet Europe and Central Asia
Eastern Europe
relation Policy Research Working Paper;No. 7877
description Greece, Ireland, Portugal, and Spain entered a period of severe economic and financial stress in the aftermath of the 2008 crisis. Their collective experience confirmed the primacy of total debt, private or public, in affecting the onset of, depth of, and recovery from economic crises. The year 2010 and the years following have demonstrated the ways in which policy responses to crisis-related downturns must be adapted when major international partners experience simultaneous growth slowdowns and markets exhibit increased risk aversion. This paper compares the recovery experience of these countries in light of recent policy debates and research on the impact of macroeconomic and structural reforms. It highlights that (a) the quality of the policies adopted to stabilize economies in the short run affects growth recovery in the long run; and (b) macroeconomic policies (fiscal and monetary) are most effective in supporting growth when they take into account structural differences between countries and when policies complement each other. The country experiences indicate that a holistic view of factors affecting investment, exports, and employment is needed to understand the impact of macroeconomic and structural reforms on output. In the absence of such a holistic view, policy may neglect to influence the binding constraints to growth.
format Working Paper
author Islam, Roumeen
author_facet Islam, Roumeen
author_sort Islam, Roumeen
title Growth Recovery in Southern Europe : A Dozen Lessons, Old and New
title_short Growth Recovery in Southern Europe : A Dozen Lessons, Old and New
title_full Growth Recovery in Southern Europe : A Dozen Lessons, Old and New
title_fullStr Growth Recovery in Southern Europe : A Dozen Lessons, Old and New
title_full_unstemmed Growth Recovery in Southern Europe : A Dozen Lessons, Old and New
title_sort growth recovery in southern europe : a dozen lessons, old and new
publisher World Bank, Washington, DC
publishDate 2016
url http://documents.worldbank.org/curated/en/886151478108905259/Growth-recovery-in-southern-Europe-a-dozen-lessons-old-and-new
http://hdl.handle.net/10986/25677
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