Recently, I was researching a post on US v EU unemployment. No.1 on Google (a news result) was a post with some observations on EU vs US economic policy. This paragraph caught my attention …But many European countries have completely mismanaged their budgets for continued government stimulus, which lends to the argument of free market …
This is an article published in the LSE about the Austrian view of the Eurozone crisis ‘The Work of Hayek shows why EU governments can’t spend their way out of problems‘ I’ve attempted to summarise the article, but I advise reading it for yourself: The recent boom and bust was caused by artificially low interest …
Balanced Budget Fiscal Expansion is an attempt to increase aggregate demand through changing spending and taxation levels, whilst leaving the overall fiscal budget situation the same. Essentially, the idea is that if you increase spending and taxes equally, the increased government spending has a bigger positive impact on economic growth than the negative impact of …
Readers Question: Will Cutting Public spending bring economic growth?Do Countries with lower government spending as a % of GDP have higher economic growth rates? After recent data on -0.7% growth in Q2 2012, several experts offered suggestions for restoring economic growth to the UK. In the Guadian, Sheila Lawlor suggested (link): The UK’s output figures, …
The new French President Francois Holland has cut the country’s retirement age. For workers who begin work at 18, they will now be able to retire at 60 (cut from 62) The move is controversial given the state of the French and European economy. He cites social justice as the reason for cutting the retirement …
Paul Krugman has been one of the clearest and strongest advocates of fiscal stimulus to end the recession which we have faced since the credit crisis of 2008. The basic premise of the book – ‘End This Depression Now!‘ is based on Keynesian analysis of a prolonged recession and liquidity trap. The basic argument is …
Most European countries have embarked on a range of austerity measures designed to reduce their budget deficits. Why have austerity measures been pursued with great vigour in Europe? What is impact of austerity measures on economic activity? Why Austerity? Pressure from Bond Markets. Investors have become nervous about holding debt in several Euro-zone countries. This …
In one sense the US is facing a debt crisis. The level of government borrowing has risen sharply as a % of GDP, and given current spending commitments, the forecast for borrowing is to continue to grow. Nevertheless, despite disputes over raising debt ceiling, the US doesn’t currently face a crisis like Greece or other …