Europe Changes Its Tune on Growth vs. Austerity
Oh dear. Reinhart and Rogoff may wish to avoid ever holidaying in Greece, Portugal, or Spain. Their seminal (and now-disproved) paper – arguing that once a country’s public debt was over 90% of their GDP, there is a strong negative relationship with the country’s economic growth –…
Recent Greek Elections Won’t Be an Immediate Cure
With the New Coalition winning majority in Greece today this means likely compromise between Athens and Berlin. A new Greek government will be able to claim an easing in austerity. And the Germans can let the EU funds flow, while claiming reform.