The Euro crisis and contradictions of Neoliberalism in Europe

Stockhammer, Engelbert (2013) The Euro crisis and contradictions of Neoliberalism in Europe. (Discussion Paper) Kingston upon Thames, U.K. : Faculty of Arts and Social Sciences, Kingston University. 21 p. (Economics Discussion Paper, no. 2013/02)

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Abstract

Neoliberalism has not given rise to a sustained profit-led growth process, but to a finance-dominated accumulation regime in which growth relies either on financial bubbles and rising household debt ('debt-driven growth') or on net exports ('export-driven growth'). The financial crisis that began in the market for derivatives on the US subprime mortgage market has translated into the worst recession since the 1930s. In Europe the crisis has been amplified by an economic policy architecture (the Stability and Growth Pact) that aimed at restricting the role of fiscal policy and insulating monetary policy and central banks from national governments. The crisis has thus led to a sharp economic divergence between core and peripheral countries. Contrary to the situation in the (export-driven) Germanic core of Europe, the crisis is escalating in the (debt-driven) southern countries of Europe. The paper interprets the policy regime as the outcome of national elites’ attempt to use European integration as a means to constrain nation states. The result is a policy regime that has fatally weakened nation states as regards their fiscal and monetary capacities without creating a European state.

Item Type: Monograph (Discussion Paper)
Uncontrolled Keywords: Euro crisis, Neoliberalism, European economic policy, European integration, financial crisis, sovere
Research Area: Economics and econometrics
Faculty, School or Research Centre: Faculty of Arts and Social Sciences > School of Economics, History and Politics (from November 2012)
Depositing User: Susan Miles
Date Deposited: 18 Dec 2013 08:43
Last Modified: 18 Dec 2013 11:48
URI: http://eprints.kingston.ac.uk/id/eprint/27724

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