Tom Sargent keynote address Emergency Economic Summit for Greece (1 June 2015)
26 Jun 2015 Leave a comment
in comparative institutional analysis, constitutional political economy, currency unions, Euro crisis, fiscal policy, macroeconomics, monetary economics Tags: EU, Euroland, Greece, sovereign borrowing, sovereign defaults, Thomas Sargent
Sovereign defaults are mainly a Latin American thing
29 May 2015 1 Comment
in international economics Tags: Argentina, Greece, international economic law, Latin America, sovereign defaults
#Dailychart: Nine of the top ten sovereign debt defaulters are from Latin America econ.st/UDi8B1 http://t.co/s0jb2yh5PN—
The Economist (@ECONdailycharts) July 31, 2014
Real GDP Portugal, Italy, Greece and Spain (PIGS) – 1955 to 2013
06 May 2015 Leave a comment
in currency unions, economic growth, Euro crisis, macroeconomics Tags: Eurosclerosis, Greece, Italy, PIGS, Portugal, Spain
Figure 1: Real GDP per Portuguese, Italian, Greek and Spaniard aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1955-2013
Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics
Figure 2: Real GDP per Portuguese, Italian, Greek an Spaniard aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013
Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics
Note that a flat line in figure 2 is growth in real GDP for that year at 1.9%; a rising line is above trend rate of growth; and a falling line is below trend rate growth for that year.
The PIGS had three distinct phases in their post-war growth. Rapid growth up until about the mid 70s. Growth at about the trend rate of growth of 1.9% until about 2000 in the case of Italy. This was followed by slow decline then rapid decline after the global financial crisis.
Figure 3: Real GDP per Italian aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013
Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics
Greece had a different story with the long decline between 1979 to 1995. This was followed by 10 good years of growth followed by sharp decline with the onset of the global financial crisis.
Figure 4: Real GDP per Greek aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013
Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics
Portugal was in a boom In the 1980s and 1990s followed by what borders on a depression since about 2000.
Figure 5: Real GDP per Portuguese aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013
Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics
Spain had a pretty good run from the mid-1980s until the eve of the global financial crisis with somewhat above trend growth after a period of decline in the 1970s.
Figure 6: Real GDP per Spaniard aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013
Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics
What is left of Greece
05 May 2015 Leave a comment
Greece.
(Source: wsj.com/article_email/…) http://t.co/ZWYwiKt9W1—
Justin Wolfers (@JustinWolfers) May 02, 2015
The ease of enforcing contractual rights in Europe
11 Apr 2015 Leave a comment
in Euro crisis, law and economics, macroeconomics, property rights Tags: ease of doing business, European Union, Eurosclerosis, Greece, rule of law
The share market speaks on Grexit: banknote printer shares soar
20 Feb 2015 Leave a comment
in currency unions, macroeconomics, monetary economics Tags: event studies, Greece
@DanHannanMEP Seems you're not alone, judging from the DeLaRue share price… #newdrachmasplease http://t.co/rrQgr6EtSu—
James v B (@CausticCorner) February 19, 2015
Where the €227B loans to Greece since 2010 have gone
18 Feb 2015 Leave a comment
in currency unions, Euro crisis, global financial crisis (GFC), macroeconomics Tags: Greece, sovereign default
What happens when you play “chicken” with a game theorist (The Greek Finance Minister)?
14 Feb 2015 Leave a comment
in currency unions, Euro crisis, international economics Tags: game theory, Greece, Greek default, optimal currency areas, sovereign default
Luke Froeb suggests:
However, opting for forgiveness risks creating dangerous incentives for other countries to act in the same way as Athens. “Germany may decide that if the eurozone does not punish Greece, it will have problems with other countries such as Spain and Italy,” says Roger Myerson, a Nobel-winning economist at the University of Chicago.
Mr Varoufakis should therefore try to convince Germany that Athens’ situation is unique and that other eurozone countries will not seek debt relief as a result, he says. In doing so, he would follow the illustrious precedent of the citizens of Melos, to whom Athens, during the Peloponnesian war between Athens and Sparta, gave the choice of surrendering or facing annihilation.
“The Melians sought to argue that they were different and that sparing them would not set a dangerous precedent vis-à-vis other islands,” says Mr Myerson.
The problem with this strategy, however, is that the other player may choose to build a reputation for toughness. This is what Athens opted for — it laid siege to the island and starved the inhabitants into submission.
via Managerial Econ: What happens when you play “chicken” with a game theorist? and Greek Game Theory: Default, Devaluation, Deliverance?..
Utopia, you are standing in it! 
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