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Growth Dynamics Exposed to Conflict Between Easy Monetary Conditions and Fiscal Restriction. Medium-term Forecast for the World Economy Until 2017

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  • Stephan Schulmeister

Abstract

After a cyclical slowdown in 2012-13, GDP growth in the industrialised economies should pick up to reach an average annual rate of 2.0 percent over the period from 2012 to 2017. In the USA, the growth momentum will be stronger (2.4 percent p.a.) than in the EU (1.4 percent) or Japan (1.5 percent). Growth in the euro area will only attain 1.1 percent per year, as many countries will only gradually rid themselves from the government debt crisis. In the new EU member countries, output growth will be nearly three times as high (3.2 percent per year). China and India will continue to enjoy the fastest pace of growth, at 7.9 percent and 7.7 percent p.a., respectively). In the other developing or emerging economies, GDP is expected to expand by around 4½ percent per year until 2015.

Suggested Citation

  • Stephan Schulmeister, 2013. "Growth Dynamics Exposed to Conflict Between Easy Monetary Conditions and Fiscal Restriction. Medium-term Forecast for the World Economy Until 2017," Austrian Economic Quarterly, WIFO, vol. 18(1), pages 25-40, April.
  • Handle: RePEc:wfo:wquart:y:2013:i:1:p:25-40
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    References listed on IDEAS

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    1. Serguei Kaniovski & Hans Pitlik & Stefan Schiman-Vukan, 2013. "Economic Growth to Remain Subdued Over the Years to Come. Medium-term Forecast for the Austrian Economy Until 2017," Austrian Economic Quarterly, WIFO, vol. 18(1), pages 15-24, April.
    2. Martin Larch & Alessandro Turrini, 2009. "The cyclically-adjusted budget balance in EU fiscal policy making : A love at first sight turned into a mature relationship," European Economy - Economic Papers 2008 - 2015 374, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    3. Stephan Schulmeister, 1995. "Zinssatz, Wachstumsrate und Staatsverschuldung," WIFO Monatsberichte (monthly reports), WIFO, vol. 68(3), pages 165-180, March.
    4. Torsten Niechoj & Ulrike Stein & Sabine Stephan & Rudolf Zwiener, 2011. "Deutsche Arbeitskosten: Eine Quelle der Instabilität im Euroraum," IMK Report 68-2011, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    5. Stephan Schulmeister, 2012. "Crisis of European Monetary Union Dampens Global Growth Momentum. Medium-term Forecast for the World Economy Until 2016," Austrian Economic Quarterly, WIFO, vol. 17(1), pages 24-36, March.
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