Monday December 22, 2014 Search
Weather | Athens
13o C
8o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Greece made largest fiscal adjustment, says EU paper published 'by mistake'

By Nikos Chrysoloras

Brussels - Greece performed the largest fiscal adjustment in the eurozone between 2011 and 2013, according to a research paper by the European Commission’s Directorate-General for Economic and Financial Affairs, which was apparently published by mistake on Monday.

The paper, which examines the systemic impact of deficit reduction programs, was taken down from DG ECFIN’s site and Twitter account a few hours after being published but Kathimerini has a copy of the study and proof that it was published.

A Commission spokesman told Kathimerini that the paper was a draft and had been published “by mistake”. He added that the study would be published “in the coming weeks” and that research papers “don’t represent Commission positions.”

The study, titled “Fiscal consolidations and spillovers in the euro area periphery and core” says that: “By far the largest fiscal consolidations have taken place in Greece, 9 percent of GDP on the basis of the change in the structural balance over these three years.”

“Portugal has also undertaken large consolidations, close to 7 percent of GDP, while the adjustment in Ireland amounted to 4 percent over these years,” adds author Jan in ‘t Veld.

The basic academic conclusion of the paper is that the simultaneous adoption of adjustment programs in the eurozone made it more difficult for periphery countries, like Greece, to achieve fiscal balance and regain competitiveness.

“Spillovers from consolidations in Germany and core euro area have worsened the overall economic situation. A temporary fiscal stimulus in surplus countries can boost output and help reduce their current account surpluses,” the author argues in his abstract.

Even though Greece’s current account balance improved by 2.3 percent of GDP during the period in question, Germany’s also improved by 0.6 percent, meaning that Germany essentially continued to compete against the eurozone periphery and pile pressure on the already struggling economies of the south.

The projections in the research paper suggest that the contraction of Greece’s economy would have been 2 percent smaller during the last three years if fiscal adjustment programs were not applied at the same time throughout the eurozone.

The negative impact of these programs on fiscal multipliers is most pronounced in Italy and then Greece, with a factor of 0.9. The author says the impact would have been smaller if the adjustment programs focussed more on revenues rather than spending.

ekathimerini.com , Tuesday October 22, 2013 (12:24)  
Political saga is harming liquidity
Bad timing for tenders as oil rates decline
Tax exemptions deprive state budget of over 3.5 bln euros
Teiresias to track letters of guarantee
Greek PM offers compromise solution with elections by end-2015
Prime Minister Antonis Samaras on Sunday presented a compromise solution to end a political stalemate that looks likely to send Greece to early general elections in about a month's time. Spe...
Environment Ministry to reconsider controversial bill
The government over the weekend appeared to backpedal on proposed amendments widely seen as compromising legislation protecting Greek forests as well as Plaka, Athens’s old quarter. The bill...
Inside News
SOCCER
Special day for Abidal, lucky one for PAOK
PAOK scraped through its Livadia challenge beating Levadiakos to remain on top of the Super League for Christmas, one point ahead of Olympiakos that enjoyed a great game at Kalloni and offer...
BASKETBALL
Explosive Barca unfazed by Panathinaikos, bomb scare
Panathinaikos lost 80-67 at home to Barcelona on Friday in a rather meaningless game at the end of the first group stage of the Euroleague, but the encounter will be remembered for the bomb ...
Inside Sports
INTERVIEW
‘Crisis of confidence will come back again and again,’ says Thomas Piketty
He’s treated like a rock star wherever he goes to lecture. His book “Capital in the 21st Century,” a study on income and wealth inequality from the 18th century to the present, recently tran...
COMMENTARY
Who lost Greece
If Greece collapses much will be said about where the fault lies. Sure, we all know the failings of Greek politicians. That said, much of the blame lies with outsiders who pushed Greece beyo...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Special day for Abidal, lucky one for PAOK
2. Political saga is harming liquidity
3. Bad timing for tenders as oil rates decline
4. Tax exemptions deprive state budget of over 3.5 bln euros
5. Teiresias to track letters of guarantee
6. Agenda
more news
Today
This Week
1. Greek PM offers compromise solution with elections by end-2015
2. Who lost Greece
3. ‘Crisis of confidence will come back again and again,’ says Thomas Piketty
4. Snubbing the moderates
5. Agenda
6. Bad timing for tenders as oil rates decline
Today
This Week
1. Samaras summons bond vigilantes with euro exit talk
2. A friendly yet firm message from Pierre Moscovici
3. Europe's drama in Greece needs final act to avoid tragedy
4. High stakes
5. On the edge but not gutless
6. Girl, aged 11, gives birth on Crete
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.