Premium
THE PORTUGUESE MALAISE: STRUCTURAL CAUSES OF THE CRISIS AND LESSONS FOR THE EUROZONE
Author(s) -
Azevedo Alves André
Publication year - 2011
Publication title -
economic affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.24
H-Index - 18
eISSN - 1468-0270
pISSN - 0265-0665
DOI - 10.1111/j.1468-0270.2011.02079.x
Subject(s) - centralisation , economics , incentive , international economics , portuguese , european debt crisis , currency , current account , competition (biology) , malaise , monetary economics , economic system , macroeconomics , market economy , european integration , european union , exchange rate , medicine , immunology , ecology , linguistics , philosophy , biology
The analysis of the structural causes of the Portuguese crisis points to a mix of internal and external factors that reinforced each other. Among the external factors were the perverse incentives posed by the current institutional setting in the EU and the single currency. These have wider implications for the eurozone in that the long‐term sustainability of the eurozone will require more effective operation of internal adjustment mechanisms. Additionally, the implementation of monetary competition in the eurozone is suggested as an alternative to the current path towards greater centralisation.