blanchard - The Globalist | Global Economy - Is Europe...

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Print | Go Back to Story The economic evidence seems quite clear: Europe has made virtually no progress over the past 30 years in catching up with the United States in terms of per capita income. But that view is inaccurate, as Olivier Blanchard argues. He finds that European productivity growth has exceeded that of the United States — it's just that Europeans have chosen to use these productivity gains in a different way. After three years of near stagnation, the mood in Europe is definitely gloomy. A discouraging outlook The two economic books on the bestseller list in France in 2003 are called "La France qui Tombe" ("The Fall of France") and “Le Desarroi Français" ("The French Disarray"). Both books offer a pessimistic vision of France and its economic future, a future in which — unless dramatic reforms are implemented – France will steadily lose ground against its competitors. France is not alone. All over Europe, governments are trying to put on a good face. But their boasts — such as the goal adopted at the EU Lisbon conference in March 2000 to make the European Union "the world's most dynamic and competitive economy within ten years" — are seen largely as empty rhetoric, if not pathetic. Post-war period ideas The most articulate diagnoses of where Europe stands today argue that — like Stalinist growth in another time and place — the European model worked well for post-war Europe, but is no longer fit for these times. For much of the post-war period, the argument goes, European growth was based on the notion of "catch-up growth," based primarily on imitation rather than innovation. For such growth, large European firms — protected in both
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This note was uploaded on 04/11/2009 for the course ECON 102 taught by Professor Serra during the Winter '08 term at UCLA.

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blanchard - The Globalist | Global Economy - Is Europe...

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