IDEAS home Printed from https://ideas.repec.org/h/pal/palchp/978-1-137-32903-5_8.html
   My bibliography  Save this book chapter

Economic Policymaking within the Eurozone

In: Crisis in the Eurozone

Author

Listed:
  • Mark Baimbridge

    (University of Bradford)

  • Philip B. Whyman

    (University of Central Lancashire)

Abstract

As previously outlined, a country within the eurozone faces a considerably different macroeconomic policy framework from that previously experienced by EU member states. Monetary policy is now set by the independent ECB, whilst national governments possess fiscal and supply-side policies. Hence, from an individual country’s viewpoint, interest rates are now ‘fixed’ and will only move if the ECB decides that economic conditions are changing for the eurozone as a whole and not if an individual country, or group of countries, suffers an economic shock (McKinnon, 2003; von Hagen, 2003; Wyplosz, 2003). Thus, the eurozone participating countries now have two choices. Firstly, provided that it does not infringe the convergence criteria/SGP, a country can use fiscal policy to counteract whatever shock has occurred (Gali and Perotti, 2003). Secondly, that country can wait for its labour market to alter wages and then prices and, thus, its overall degree of international competitiveness.

Suggested Citation

  • Mark Baimbridge & Philip B. Whyman, 2015. "Economic Policymaking within the Eurozone," Palgrave Macmillan Books, in: Crisis in the Eurozone, chapter 8, pages 121-136, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-137-32903-5_8
    DOI: 10.1057/9781137329035_8
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:palchp:978-1-137-32903-5_8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.