 Peripheral Europe's debt and German wages: the role of wage policy in the Euro areaInternational Journal of Public Policy, 2011, vol. 7, issue 1/2/3, 83-96 Abstract: The paper argues that the Greek debt crisis, as well as those of other Southern European countries and Ireland, has to be seen in macroeconomic context. The sum of the public sector balance, the (domestic) private sector balance and the current account deficit (or equivalently: the capital inflows) has to add up to zero. By implication in a country that has a current account deficit either the private sector or the public sector has to run a deficit. Therefore, the peripheral countries can only solve their public debt problems if there is a change in German current account surpluses. The paper explores the implications of this for wage policy in the Euro zone. Keywords: Economic and Monetary Union; EMU; euro area; eurozone; European Union; EU; financial crises; single currency; currencies; sovereign debt; wage policies; wage coordination; Southern Europe; Germany; Greece; Ireland; macroeconomics; public sector; financial balances; domestic sector; private sector; current accounts; account deficits; capital inflows; peripheral countries; public debt; account surpluses; wages; Portugal; Italy; Spain; peripheral Europe; public policy; economic policies; alternative paradigms. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ids:ijpubp:v:7:y:2011:i:1/2/3:p:83-96 Access Statistics for this article More articles in International Journal of Public Policy from Inderscience Enterprises Ltd |
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