Secular stagnation and core-periphery uneven development in post-crisis eurozone

Alberto Botta and Benjamin Tippet

No 32109, Greenwich Papers in Political Economy from University of Greenwich, Greenwich Political Economy Research Centre

Abstract: In this paper, we analyse secular stagnation in the eurozone. We adopt a core-periphery perspective and analyse whether the 2007-2008 financial crisis triggered off diverging dynamics in the growth potential of core and peripheral eurozone countries. We find that secular stagnation affects the whole eurozone but is a much more serious concern in the periphery. Among the components of potential GDP, the NAIRU in particular has diverged since 2008. We find that the increase in the NAIRU is strongly related to demand-side factors such as investment demand and the fiscal policy stance, as well as to the technological level of the economy. Labour market institutions seem to play a relatively minor role, which may also change depending on the level of technological development of an economy. In line with these findings, we argue that reforms in the eurozone should focus on levelling out the core-periphery technological gap via industrial policy, and on the creation of homogenous financial and macroeconomic conditions among member countries, rather than on the generalized deregulation of labour markets.

Keywords: Core-periphery; eurozone; secular stagnation; structuralism; uneven development (search for similar items in EconPapers)
Date: 2021-03-24
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://gala.gre.ac.uk/id/eprint/32109/7/32109%20BO ... on_%28OA%29_2021.pdf
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://gala.gre.ac.uk/id/eprint/32109/7/32109%20BOTTA_Secular_Stagnation_%28OA%29_2021.pdf [302 Moved Temporarily]--> https://gala.gre.ac.uk/id/eprint/32109/7/32109%20BOTTA_Secular_Stagnation_%28OA%29_2021.pdf)

Related works:
Working Paper: Secular stagnation and core-periphery uneven development in post-crisis eurozone (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gpe:wpaper:32109

Access Statistics for this paper

More papers in Greenwich Papers in Political Economy from University of Greenwich, Greenwich Political Economy Research Centre Contact information at EDIRC.
Bibliographic data for series maintained by Nadine Edwards ().