Greece’s real problem

Professor Hausmann has responded again to my reply to his reply to my criticisms of his Project Syndicate post. It is a very gracious response. We are substantially in agreement on the three points that I raised in my previous post: the long-standing nature of Greece’s fiscal fragility, the illusory GDP growth fuelled by the pre-crisis debt bubble that obscured the deterioration in Greece’s financial position, and – above all – the long-term decline of Greece’s competitiveness. And oddly enough, this means that we are also in agreement about the current situation in Greece, though we frame it differently. Professor […]

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