European Parliament Library

Risks of Stagnation in the Euro Area, Huidan Lin

This paper discusses the risks of stagnation over the medium term in the euro area. It examines the consequences of longer-term growth trends that predate the crisis and the progress made in addressing the crisis legacies of high unemployment and debt. The paper illustrates in a downside scenario, how low potential growth and crisis legacies leave the euro area vulnerable to a negative shock that tips the economy into a prolonged slowdown
Table Of Contents
Cover -- Contents -- I. Motivation -- II. Output per Capita: Diagnosis and Prospects -- A. Labor -- B. Capital -- C. Total factor productivity -- III. Crisis Legacies: Progress and Prospects -- A. High Unemployment -- B. High Debt -- IV. An Illustrative Downside Scenario -- V. Concluding Remarks -- References -- Figures -- 1. Actual and Pre-crisis Trend Output -- 2. Actual and Potential Output -- 3. Contribution to Growth in Hours Worked per Capita -- 4. Simulation Results: Investment Shock -- 5. Simulation Results: Investment and Risk Premium Shock -- Table -- Results from an Illustrative Downside Scenario
Literary Form
non fiction
Physical Description
1 online resource (26 pages)
Specific Material Designation
Form Of Item

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