Domestic demand and global production in the Eurozone: a multi-regional input-output assessment of the global crisis

Garbellini, Nadia, Marelli, Enrico and Wirkierman, Ariel Luis (2014) Domestic demand and global production in the Eurozone: a multi-regional input-output assessment of the global crisis. International Review of Applied Economics, 28 (3). pp. 336-364. ISSN 0269-2171

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Abstract

This paper studies the effects of domestic and foreign demand impulses in euro area economies following the Great Recession of 2008-2009 and the Eurozone crisis of 2011-2012. Using a global Input-Output framework we apply a set of metrics to assess spillover effects of international trade in intermediates triggered by the dynamics of final demand. Our findings suggest that while cross-country trade spillovers have played a crucial role during the Great Recession, they have had a moderate impact when compared with the role of domestic sources of final demand during the Eurozone crisis. Hence, a strategy of coordinated fiscal austerity cannot be sustained by empirical evidence.

Item Type: Article
Keywords: global crisis, international trade, multi-regional input–output analysis, C67, F14, R15
Schools and Departments: School of Business, Management and Economics > SPRU - Science Policy Research Unit
Subjects: H Social Sciences > HB Economic theory. Demography > HB0075 History of economics. History of economic theory Including special economic schools
H Social Sciences > HB Economic theory. Demography > HB0131 Methodology > HB0135 Mathematical economics. Quantitative methods Including econometrics, input-output analysis, game theory
H Social Sciences > HB Economic theory. Demography > HB0241 Production. Theory of the firm. Supply-side economics
Depositing User: Ariel Wirkierman
Date Deposited: 04 Jul 2016 16:07
Last Modified: 04 Jul 2016 16:07
URI: http://sro.sussex.ac.uk/id/eprint/61877
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