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Some Thoughts On The Spanish Economy After Five Years Of Crisis

Author

Listed:
  • Eloísa Ortega

    () (Banco de España)

  • Juan Peñalosa

    () (Banco de España)

Abstract

This paper briefl y describes some features of the situation of the Spanish economy after five years of crisis, a task which is easier now that this period can be analysed from a certain perspective. The crisis prompted a substantial readjustment of the main Spanish macroeconomic aggregates, affecting the level and composition of GDP, employment and the balance sheet position of the institutional sectors. During this period some of the imbalances that built up during the upturn have been corrected and several key variables are currently at around the average European levels. All told, the legacy of the crisis, in terms of the magnitude of unemployment and of the still high levels of indebtedness, makes for a complex outlook and suggests that the recovery will be gradual and not free of uncertainty. This uncertainty mainly affects the functioning of the economy’s adjustment mechanisms, particularly those working through the channels of competitiveness and of private sector balance sheets. Despite the depth of the crisis in Spain, the progress made in the reforms on various fronts is, on balance, significant. From the perspective provided by the analysis of the crisis in this paper, supply-side policies will have to play a major role in the current phase of the cycle to enable the recovery to proceed firmly.

Suggested Citation

  • Eloísa Ortega & Juan Peñalosa, 2013. "Some Thoughts On The Spanish Economy After Five Years Of Crisis," Occasional Papers 1304, Banco de España;Occasional Papers Homepage.
  • Handle: RePEc:bde:opaper:1304
    as

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    File URL: http://www.bde.es/f/webbde/SES/Secciones/Publicaciones/PublicacionesSeriadas/DocumentosOcasionales/13/Fich/do1304e.pdf
    File Function: First english version, December 2013
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    File URL: http://www.bde.es/f/webbde/SES/Secciones/Publicaciones/PublicacionesSeriadas/DocumentosOcasionales/13/Fich/do1304.pdf
    File Function: First spanish version, December 2013
    Download Restriction: no

    References listed on IDEAS

    as
    1. repec:mtp:titles:026201761x-01 is not listed on IDEAS
    2. Blanchard, Olivier, 2012. "Monetary Policy in the Wake of the Crisis," MIT Press Book Chapters,in: In the Wake of the Crisis: Leading Economists Reassess Economic Policy, edition 1, volume 1, chapter 1, pages 7-13 The MIT Press.
    3. Silvia Merler & Jean Pisani-Ferry, 2012. "Sudden Stops in the Euro Area," Review of Economics and Institutions, Università di Perugia, vol. 3(3).
    4. Daniel Gros & Cinzia Alcidi, 2015. "Country adjustment to a ‘sudden stop’: does the euro make a difference?," International Economics and Economic Policy, Springer, vol. 12(1), pages 5-20, March.
    5. Pablo Hernández de Cos & Javier J. Pérez, 2013. "The new budgetary stability law," Economic Bulletin, Banco de España;Economic Bulletin Homepage, issue APR, April.
    6. Luis Julián Álvarez & Alberto Urtasun, 2013. "Variation in the cyclical sensitivity of Spanish inflation: an initial approximation," Economic Bulletin, Banco de España;Economic Bulletin Homepage, issue JUL, July-Augu.
    7. Pablo Hernández de Cos & Mario Izquierdo & Alberto Urtasun, 2011. "An estimate of the potential growth of the Spanish economy," Occasional Papers 1104, Banco de España;Occasional Papers Homepage.
    8. De Grauwe, Paul, 2011. "Governance of a Fragile Eurozone," CEPS Papers 5523, Centre for European Policy Studies.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Spanish economy; economic crisis; adjustment; rebalancing; internal devaluation; competitiveness; balance sheet position; indebtedness; reforms;

    JEL classification:

    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • G01 - Financial Economics - - General - - - Financial Crises
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management

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