The European experience with large fiscal adjustments

Thursday, 29 April 2010
Downloaded 2,810 times

The Greek government has promised that it will cut its deficit by about 10-12% of GDP. In their review of past episodes of fiscal adjustments in the EU, CEPS researchers Cinzia Alcidi and Daniel Gros find such a huge adjustment is possible but it will probably take at least five years, and might still leave the country in a highly unstable position.