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http://hdl.handle.net/10419/57021
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| Title: | | Can Portugal escape stagnation without opting out from the Eurozone?  |
| Authors: | | Leao, Pedro Palacio-Vera, Alfonso |
| Issue Date: | | 2011 |
| Series/Report no.: | | Working paper, Levy Economics Institute 664 |
| Abstract: | | The creation of the Economic and Monetary Union (EMU) has not brought significant gains to the Portuguese economy in terms of real convergence with wealthier eurozone countries. We analyze the causes of the underperformance of the Portuguese economy in the last decade, discuss its growth prospects within the EMU, and make two proposals for urgent institutional reform of the EMU. We argue that, under the prevailing institutional framework, Portugal faces a long period of stagnation, high unemployment, and painful structural reform, and conclude that, in the absence of institutional reform of the EMU, getting out of the eurozone represents a serious political option for Portugal. |
| Subjects: | | nominal wage cuts Eurozone relative unit labor costs zero-sum game |
| JEL: | | E32 E65 F32 F41 J50 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Working Papers, Levy Economics Institute of Bard College
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