Title: Comparing post-crisis dynamics across Euro Area countries with the Global Multi-country model
Authors: ALBONICO ALICECALÈS LUDOVICCARDANI ROBERTACROITOROV OLGAFERRONI FILIPPOGIOVANNINI MASSIMOHOHBERGER STEFANPATARACCHIA BEATRICEPERICOLI FILIPPORACIBORSKI RAFALRATTO MARCOROEGER WERNERVOGEL LUKAS
Citation: ECONOMIC MODELLING vol. 81 p. 242-273
Publisher: ELSEVIER SCIENCE BV
Publication Year: 2019
JRC N°: JRC112059
ISSN: 0264-9993 (online)
URI: https://www.sciencedirect.com/science/article/pii/S0264999318307958?via%3Dihub
http://publications.jrc.ec.europa.eu/repository/handle/JRC112059
DOI: 10.1016/j.econmod.2019.04.016
Type: Articles in periodicals and books
Abstract: Following the global financial crisis, the Euro Area (EA) has experienced a persistent slump and notable tradebalance adjustments, but with pronounced differences across EA Member States. We estimate a multi-countrystructural macroeconomic model to assess and compare the main drivers of GDP growth and trade balanceadjustment across Germany, France, Italy, and Spain. We find that the pronounced post-crisis slump in Italyand Spain was mainly driven by positive saving shocks (‘deleveraging’) and by an increase in investment andintra-euro risk premia. Fiscal austerity in Spain and the productivity slowdown in Italy have been additionalsizable contributors to the economic downturn. The results further suggest that euro depreciation, heightenedintra-euro risk premia and subdued investment had a sizable impact on the trade balance reversals in Italy andSpain, which has been offset in France by a strong increase in imports and lower exports.
JRC Directorate:Growth and Innovation

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