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Europe’s growth problem (and what to do about it)

Darvas, Zsolt, Pisani-Ferry, Jean and Wolff, Guntram, (2013), “Europe’s growth problem (and what to do about it)”, Bruegel – The Brussels-based think tank, 12 Απριλίου.

The issue: The European Union’s pre-crisis growth performance was disappointing enough, but the performance has been even more dismal since the onset of the crisis. Weak growth is undermining private and public deleveraging,and is fuelling continued banking fragility. Persistently high unemployment is eroding skills, discouraging labour market participation and undermining the EU’s long-term growth potential. Low overall growth is making it much tougher for the hard-hit economies in southern Europe to recover competitiveness and regain control of their public finances. Stagnation would reduce the attractiveness of Europe for investment. Under these conditions, Europe’s social models are bound to prove unsustainable.