Abstract
Vigorous debate over the effectiveness of the fiscal adjustment programmes for the crisis-stricken countries in the eurozone has grown quite polarised. In this Forum, several experts use analytical, evidence-based approaches to gauge the effectiveness of these programmes. The role played by the estimates of the fiscal multipliers that the Commission, IMF and ECB used to structure the adjustment programmes is crucial to this debate. If these multipliers were underestimated, as the IMF itself claims, then the negative impact of the fiscal restructuring on already fragile economies would also have been underestimated. Several authors examine the available evidence to determine whether the adjustments programmes were flawed from the outset. Another contribution analyses the effectiveness of structural reforms when monetary policy rates are near the zero lower bound. A final paper uses a case study of Ireland’s recovery thus far to examine the actual effects that the programmes have had on the crisis-stricken countries’ economies.
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This article is based on the author’s contribution to the European Commission’s Quarterly Report on the Euro Area, Vol. 13, No. 3, October 2014. The views are personal views of the author.
We are grateful to the Central Statistics Office for access to the data from the Survey on Income and Living Conditions (SILC). Responsibility for the analysis and interpretation of these data rests with the authors.
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Alcidi, C., Gros, D., Giovannini, A. et al. Crisis-Induced Fiscal Restructuring in Europe. Intereconomics 49, 300–322 (2014). https://doi.org/10.1007/s10272-014-0514-y
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DOI: https://doi.org/10.1007/s10272-014-0514-y