Lessons from the Germany shock: Consequences of uncoordinated economic policies in a currency union

Harald Fadinger, Philipp Herkenhoff Jan Schymik

As the world emerges from the Covid crisis, it is witnessing a resurgence of industrial policy in affluent countries, including the Inflation Reduction Act and the CHIPS Act in the US. These developments are putting pressure on EU members to also engage in industrial policy measures. This column evaluates the impact of Germany’s early-2000s labour market reforms on the broader euro area. The findings underscore the importance of coordinated EU-wide policies.

Πηγή: Voxeu

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