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Europe's Growth Crisis: When and How Will It End?


  • An earlier version of this paper was presented at the Annual Meeting of the American Economic Association in Boston in January 2015. I thank Barry Eichengreen, Martin Feldstein and Dale Jorgenson for helpful comments, but I alone am responsible for any remaining shortcomings.


This paper analyses Europe's growth problem. Recovery from the recent global financial crisis and ‘great recession’ has been slower than after previous recessions in most advanced countries and areas, especially Europe. But the European growth problem is structural in character and it started much earlier. This paper analyses the structural causes of the European growth problem, evaluates the policies that Europe adopted to overcome it, and concludes that even with the appropriate policies, the prospects for accelerating growth in Europe will be difficult, especially in the context of Brexit and the slowdown of world growth in general.