A competitive growth of a small midle-income country in the eurozone is far to be assured
The dichotomy of the increasing diversity of eurozone member countries and the institutional “one-size-fits-all” setting has exposed the deficiencies of the institutional economic architecture of the eurozone in the financial and economic crisis of 2008–2010. It has particularly exposed the weaknesses of middle-income countries within this framework. Greece, Ireland, and Portugal are experiencing outright financial crises. This article’s thesis is that small middle-income countries (MICs) in the eurozone face two general macroeconomic problems: (1) there is inherent macroeconomic instability; and (2) there is a problem of “competitiveness and convergence.” Small MICs’ ability to grow and catch up is demand-based and largely export-driven. Price competitiveness is an important factor of competitive growth within the eurozone. A national fiscal policy is crucial to countries’ ability to form and implement national policies for economic stability and competitive growth, which would enable a durable, above-average growth rate. Calls for a fiscal union along with the monetary union may therefore backfire. Copyright Springer-Verlag 2012
Volume (Year): 9 (2012)
Issue (Month): 3 (September)
|Contact details of provider:|| Web page: http://www.springer.com|
|Order Information:||Web: http://www.springer.com/economics/international+economics/journal/10368/PS2|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- N. Gregory Mankiw & David Romer & David N. Weil, 1990.
"A Contribution to the Empirics of Economic Growth,"
NBER Working Papers
3541, National Bureau of Economic Research, Inc.
- Paul M. Romer, 1994. "The Origins of Endogenous Growth," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 3-22, Winter.
- Sala-i-Martin, Xavier X, 1996.
"The Classical Approach to Convergence Analysis,"
Royal Economic Society, vol. 106(437), pages 1019-36, July.
- Xavier Sala-i-Martin, 1995. "The classical approach to convergence analysis," Economics Working Papers 117, Department of Economics and Business, Universitat Pompeu Fabra.
- Sala-i-Martin, Xavier, 1995. "The Classical Approach to Convergence Analysis," CEPR Discussion Papers 1254, C.E.P.R. Discussion Papers.
- Sala-i-martin, X., 1995. "The Classical Approach to Convergence Analysis," Papers 734, Yale - Economic Growth Center.
- Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
- Olivier Blanchard, 2007. "Adjustment within the euro. The difficult case of Portugal," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 6(1), pages 1-21, April.
- Heiner Flassbeck & Friederike Spiecker, 2009. "Cracks in Euroland and no way out," Intereconomics: Review of European Economic Policy, Springer;German National Library of Economics;Centre for European Policy Studies (CEPS), vol. 44(1), pages 2-3, January.
- Bela Balassa, 1964. "The Purchasing-Power Parity Doctrine: A Reappraisal," Journal of Political Economy, University of Chicago Press, vol. 72, pages 584.
- Roel Beetsma & Massimo Giuliodori, 2010.
"The Macroeconomic Costs and Benefits of the EMU and Other Monetary Unions: An Overview of Recent Research,"
Journal of Economic Literature,
American Economic Association, vol. 48(3), pages 603-41, September.
- Beetsma, Roel & Giuliodori, Massimo, 2009. "The Macroeconomic Costs and Benefits of the EMU and other Monetary Unions: An Overview of Recent Research," CEPR Discussion Papers 7500, C.E.P.R. Discussion Papers.
- John B. Taylor, 2000. "Teaching Modern Macroeconomics at the Principles Level," American Economic Review, American Economic Association, vol. 90(2), pages 90-94, May.
- Oliver Landmann, 2012. "Rotating Slumps in a Monetary Union," Open Economies Review, Springer, vol. 23(2), pages 303-317, April.
- Abramovitz, Moses, 1986. "Catching Up, Forging Ahead, and Falling Behind," The Journal of Economic History, Cambridge University Press, vol. 46(02), pages 385-406, June.
- Marjan Senjur, 2007. "A Development Club and Groupings in Europe, and Growth Strategies," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 49(4), pages 660-682, December.
- Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-85, December.
- Dani Rodrik, 2011.
"The future of economic convergence,"
Proceedings - Economic Policy Symposium - Jackson Hole,
Federal Reserve Bank of Kansas City, pages 13-52.
- Tsoukalis, Loukas, 2003. "What Kind of Europe?," OUP Catalogue, Oxford University Press, number 9780199266661, December.
- Robert E. Lucas, 2000. "Some Macroeconomics for the 21st Century," Journal of Economic Perspectives, American Economic Association, vol. 14(1), pages 159-168, Winter.
- MacDonald, Ronald & Wójcik, Cezary, 2008. "Catching-up and inflation differentials in a heterogeneous monetary union: Some implications for the euro area and new EU Member States," Economic Systems, Elsevier, vol. 32(1), pages 4-16, March.
When requesting a correction, please mention this item's handle: RePEc:kap:iecepo:v:9:y:2012:i:3:p:213-233. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla)or (Rebekah McClure)
If references are entirely missing, you can add them using this form.