22. European crisis 2008-2012 and the need of better economic policies for recovery: Debate of EU Parliament and voices of economists

    Note: Elaborated by Guisan(2013) from OECD Statistics. Data of Spain (Es), France (Fr), Germany (De), Greece (Gr), Italy (It), Portugal (Pt), the United Kingdom (UK) and the United States (USA).

Update of 22-10-2025

In the reports IDER (International Development Economic Reports) published by the Euro-American Association of Economic Development (see Entries of this Blog for years 2021-2025), we include an analysis of the European economic problems for 2012-2025.

Original Entry of year 2013

    We may notice economic development in the period 1992-2007 in almost all the countries of the table and stagnation or declain in the period 2007-2012. The EU countries show a worse evolution than the USA.

   EU economic policies are not showing success because they are misguided towards excessive austerity and lack of incentives to development.

 There are many solutions to overcome the crisis of the period 2007-2012 and European citizens want more positive measures to improve economic development in the European Union.

  The EU authorities should listen to the voices of prestigious economists who propose better solutions.

Interesting articles in this regard, written by  prestigious economists are included and/or cited, at the section Europe in our journals:
Applied Econometrics and International Development (AEID)
Regional and Sectoral Economic Studies (RSES)

  The European Parliament is demanding more democracy and more quality of EU economic policies in order to represent the voice of European citizens and improve economic development.

  Some interesting links to the activities of the European Parliament in this regard are the following ones:

  Debate of 23-10-2013:
http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+CRE+20131023+ITEM-008+DOC+XML+V0//ES&language=es&query=INTERV&detail=3-075-000

Video of 24-9-2013: Interventions of Mario Draghi and the parlamentarians Elisa Ferreira and Werner Langen:
http://www.europarltv.europa.eu/es/player?pid=5b00651c-6591-4526-b119-a243013309d9

Video of Profesora Maria-Carmen Guisan, asking to the European Union leaders who are the advisors of the economic policies in the European Union, which are leading to industrial stagnation or diminution. She ask for a change and to foster support to industrial development after 7 years of scarce development, for 2005-2008.

18. Impact of Trade Deficit on crisis and drop of Industrial production in the USA and 5 European major countries: France, Germany Italy, Spain and UK

Graph 1. Real Value-Added of Industry per capita in France, Germany, Italy, Spain, the United Kingdom and the United States. Source: Elaborated by Guisan(2011) from OECD statistics.

Graph 2. Trade Balance of EU27 and industrial real value-added of EU5. Source: Elaborated by Guisan(2011) from Eurostat Statistics. Left axis for Extra-EU27 Trade Balance. Right axis for Value-Added of Industry. Source: Elaborated by Guisan(2011) from Eurostat and OECD statistics.

Industrial production in the Europea Union for 2000-2010: The lack of enough european policies of support to industrial production have led to decreasing real Value-Added of industry and increasing trade deficits in the balance of goods of EU27, as it is shown in the graph 2 above.

The impact of wrong policies on industrail development of many European countries has been very strong for the period 2008-2010, and some politicians and citizens are showing concern and disagreement with the EU policies in this regard. Diminution of industrial production implies negative consequences for the European Union such as lower production in other sectors, more unemployment and increse of international debt.

Graph 1 shows the evolution of real Value-Added of industry per capita in the 5 major European Union countries (those with highest levels of Gross Domestic Product and Population) for the period 1985-2010.

European Union problems: The European Union documents usually assumes that "The EU´s external trade policiy contributes to Europe´s competitiveness in foreign markets" and includes declaration as the following one: "The EU has a common trade policy whereby the European Commission negotiates trade agreements and represents the EU´s interest on behalf of its 27 Member States. The European Commission consults Member States through an advisory committee which discusses the full range of trade policy issues affecting the Community including multilateral, bilateral and unilateral instruments". In spite of these declarations many people think that policies for industrial development and less deficit should be addressed.

It is clear that the European public opinion and many leaders do not agree with those trade policies that have led to increase indebtness and diminution of industrial development. Some reactions are active in France and the United Kingdom, and surely in other countries, which may be of interest to recover industrial development and favor a balanced trade of the European Union with extra-UE partners, or at least to diminish the trade deficit.

Trade deficit in EU27: In fact in year 2009 the trade balance was negative in 17 countries, positive in 10, and negative for EU27 as a whole.

Countries with positive trade balance of goods in 2009: Belgium, Czec Rep., Denmark, Finland, Germany, Hungary, Ireland, Netherlands, Slovakia and Sweden.

Countries with negative trade balance of goods in 2009: Austria, Bulgaria, Cyprus, Estonia, France, Greece, Italy, Latvia, Lithuania, Luxembourg, Malta, Portugal, Romania, Slovakia, Spain and the United Kingdom.

The most positive balance in Euros per capita, more than 1000 € in year 2009, corresponded to Belgium (1194), Denmark (1465), Germany (1644), Ireland (8568), Netherlands (2380).

The most negative balance in Euros per capita, less than -1000 € in year 2009, corresponded to Cyprus (-5918), Greece (-2531), Luxembourg (-4940), Malta (-3283), Portugal (-1787), Spain (-1081) and the United Kingdom (-1513).

Crisis and solutions: The European Union should show concern about high deficits in extra-EU trade, particularly if those deficits lead to diminution of industrial production per capita, particular if dismantling EU´s industry is not accompanied by an increase in the International Investment Position or in other variables that can guarantee sustained development. European Economic Policies should be adressed to diminish deficit in extra-EU balance for the EU as a whole and to make sustainable the intra-EU imbalances among countries. Sustainability presents to options: 1) all EU countries would promote industrial development to a degree enough to guarantee real convergence with the most advanced economies. 2) European Unions would guarantee flows of credit from EU countries with superavit to EU countries with deficit, like among different regions of a single country. European Parliamente and Commission may choose a mix of both options, but they should offer to all EU countries opportunities for sustainable development.

Selected newspaper article on industrial problems in EU countries:

Telegraph: Where will Britaint´s manufacturing revival come from?, by Louisa Peacok, 2nd June 2011.

15. Employment in Social Services in OECD countries: Europe, United States and Japan. Euro-American Association Report 2010.

 Countries: Mexico, Spain, Italy, France, Germany, UK, USA, Japan, Finland and Switzerland

This graph shows the number of employed persons per 1000 inhabitants in services related with Education, Health, Public Administration and Other Social and Personal Services, in 10 OECD countries in year 2005:

We may notice that  in a first stage, with the lowest values, are Mexico, Spain and Italy. A second stage correspond to France and Germany, while a third stage correspond to the United Kingdom, the United States, Finland and Switzerland which are in a higher level. Finally Japan shows the top position of this group of 10 OECD countries.
The number of employed persons varies from less than 100 per thousand people in Mexico to more than 200 in Japan, with an intremediate position around 150 in the UK, the USA, Finland and Switzerland.
It is important to notice that a high number of people in social services, and the quality of their work, is of uppermost importance for social wellbeing and development.

2. Regional development in Europe: Euro-American Association of Economic Development Studies EAAEDS/AEEADE

Regional Economics: Some interesting articles and documents on regional development in the European Union, America and other areas are free downloadable at the Regional web site

Entry 2, by Maria-Carmen Guisan, Professor of Econometrics, Spain

Journal RSES: Regional and Sectoral Economic Studies has been accepted for inclusion in the prestigious index SCOPUS of Elsevier since year 2008. The journal is also indexed in other prestigious international lists: Econ-Lit of the American Economic Association, RSAI of Regional Science Association International, Webec and selected Catalogue of Latindex, among other ones.

Some selected articles, in English, on the development of European Union regions, free downloadable at our journals RSES and AEID are the following ones:

Employment, Population and Regional Development in Western and Central Europe. Econometric Models and Challenges of EU Enlargement, by Guisan, M.C. and Aguayo, E. (2004)

Education, Research and Manufacturing in EU25: An Inter-Sectoral Econometric Model of 151 European Regions, 1995-2000, by Guisan, M.C. (2004)

Decomposition of global and European socio-economic inequalities with attention to their regional dimensions, by Novotny, J. (2004)

Regional Systems of Innovation and Regional Policy in Europe, Korres, G. M. ; Chionis, D. P.and Staikouras, C. (2004)
Employment and Regional Tourism in Europe, 1990-2000, por Guisan, M.Carmen y Aguayo, Eva (2002)

The Innovation Factor: An Econometric Model of Productivity inEuropean Regions, Vieira, E., Vazquez-Rozas, E. And Neira, I. (2007)

Inter-regional Wage Dispersion in Portugal, Vieira, J.A.C., Couto, J.P.A., Tiago, M.T.B. (2006)

Regions and Low-Wage Mobility in Portugal, 1996-2000, (2004) by Vieira, J.A.C. and Madruga, P. (2004) 

Employment and Regional Development in Italy by Guisan, M. C. and Aguayo, E. (2002)

Employment and Regional Development in France by Guisan, M.C. and Aguayo, E. (2001)

Employment and Regional Development in Germany by Guisan, M.C. and Aguayo, E.(2001)

Home of the Blog: http://euroamericanassociation.blogspot.com/