How much will fiscal tightening hurt Europe?

Greeces troubles have highlighted the need for decisive fiscal consolidation in at least parts of the euro-zone. This need not be as aggressive as in the UK or US, but could still knock over 0.5% off annual euro-zone GDP growth from 2011. And with Southern Europe in the worst state, consolidation threatens to prompt widening divergences in performance within the region.

Subscriber content

Read this in full, free

Start a free trial and use one of your 10 free starter credits to unlock this piece.


Free. 10 articles. No card required.
By completing this form you are agreeing to our Terms and Conditions for the provision of a free trial of Capital Economics' services. We take your privacy seriously and will not share your details with others without your consent. By providing your details, including your email address, you are consenting to Capital Economics sending you macroeconomic commentary and analysis. You can unsubscribe at any time. See our Privacy Policy for more information.

Already a client or trialist? Log in to read this.