EconPapers    
Economics at your fingertips  
 

Growth models in advanced countries before and after the 2008 crisis: competitiveness, financial cycles and austerity

Karsten Kohler () and Engelbert Stockhammer ()

No PKWP2008, Working Papers from Post Keynesian Economics Society (PKES)

Abstract: The paper contributes to the recent growth models debate through a cross-country analysis of macroeconomic growth drivers after the 2008 crisis. It examines the role of competitiveness, finance, and fiscal policy as sources of foreign, private and public demand. While all countries experienced a slowdown in economic growth and a stronger export-orientation, macroeconomic performance has been highly uneven. Growth drivers have partly changed, calling for reconsideration of some key topics in the growth models debate. We argue that (i) non-price competitiveness has gained importance compared to price competitiveness, (ii) debt-driven growth models are cyclical and financial booms come with busts and debt overhang, (iii) post-crisis growth models are strongly shaped by fiscal policy. Northern Europe reinforced its export-orientation despite some wage and property price inflation, but with limited effects on growth. Eastern Europe benefitted from an improvement in export sophistication prior to the crisis and outperforms in terms of growth. Southern Europe underwent a debt-driven depression, exacerbated by contractionary austerity policies. While also affected by the downturn of a financial cycle, the English-speaking countries sustained demand through slower fiscal consolidation.

Keywords: growth models; austerity; financial cycles; comparative political economy; post-Keynesian macroeconomics (search for similar items in EconPapers)
JEL-codes: B50 O47 O57 (search for similar items in EconPapers)
Pages: 42
Date: 2020-03
New Economics Papers: this item is included in nep-eec, nep-hme, nep-mac and nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.postkeynesian.net/downloads/working-pap ... odels_after_2008.pdf First version, 2020 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pke:wpaper:pkwp2008

Access Statistics for this paper

More papers in Working Papers from Post Keynesian Economics Society (PKES) Contact information at EDIRC.
Bibliographic data for series maintained by Jo Michell ().

 
Page updated 2020-08-07
Handle: RePEc:pke:wpaper:pkwp2008