Dr Christian Reiner, senior researcher at the Lauder Business School, gives a series of lectures on the topic of “Macroeconomic imbalances in the Eurozone: Causes, effects and possible solutions”.
The economic performance of the Eurozone in the years after the Great Recession has been very disappointing. The unemployment rate soared to record highs and it is still at around 9.5% almost 8 years after the crisis. Economic growth has been weak and less dynamic than in the US or the United Kingdom. In addition, economic disparities and political conflicts have increased significantly since about 2010 and the crisis in countries such as Greece are still far from resolved. Basically, a rich and austerity oriented northern block of the Eurozone confronts an economically weak and indebted southern group of Eurozone countries. Several scholars argue that these failures are not the result of bad luck but of bad public policies. Essentially, the European Central Bank and the policy stance on fiscal policy have been criticized by Keynesian economists such as Paul Krugman or Joseph Stiglitz. Yet an even more detailed analysis reveals that the system of the Eurozone as a currency union does not provide the public good of a smooth and balanced development of its member states. The member countries lost important tools of national economic adjustment to adverse macroeconomic shocks (exchange rate policy, monetary policy and partly fiscal policy) without receiving substitutes at the European level. This makes it very difficult for crisis-ridden countries to recover. The prolonged crisis has already caused dramatic costs to the European society with almost a decade of forgone output and high unemployment. Hence, the question is what can be done to prevent the collapse of the Eurozone and to jumpstart a new era of economic prosperity on Europe?
These and other issues are discussed in the lecture series at the University of Salzburg. Please find a selection of the presentation slides of Mr Reiner (in German) slide set 1 , slide set 2 , slide set 3.