Italy’s economy is defying the laws of gravity, but for how long?
Europe has fallen behind the United States and Asia in a number of areas that will be key to economic success in the future. The EU will have to take a few key steps if it is to make up lost ground.
The “convergence machine” was designed to build wealth within the continent while helping its lagging members catch up. Now, however, the same mechanisms are rendering the currency union less flexible.
It has become the economistʼs holy grail – but competitiveness is too nebulous to guide policy. Increasing productivity should be Europe’s real concern, and this requires a comprehensive reform agenda.