In the News
Is Germany damaging the European economy?
29th November 2019
A fascinating stretch-and-challenge article here for high fliers, this fantastic Guardian article looks at why a current account surplus can be problematic, and not just for the economy experiencing it.
Maximilian Krahe and David Adler write that the state of the German economy is a real problem, both for Germany and the Eurozone more widely. Picture this: Germany is currently in recession and still has a current account surplus. How can this happen and what causes this.
Similarly, the article postulates that the current account surplus damages other European economies - at its most basic, it represents a leakage from their circular flow. So how does Germany go about correcting this.
Interestingly, when talking about current account problems, Keynes was astute enough to see countries with persistent surpluses as more problematic than those with small deficits, and he also argued that those countries stood more chance of being able to correct those surplus than countries experiencing a current account deficit.
You might also like
Balance of Payments - Policies to Improve Trade
Study Notes
Would Norway benefit from being inside the European Union?
1st April 2015
Beyond the Bike Lesson Resource: Stages of Economic Integration
22nd October 2015
Current account deficits - when to act?
17th May 2016
Countries that Export Printing Presses
9th January 2017
Japanese economy contracts by 4.8% in 2020
15th February 2021
UK Economy - Why is the Trade Deficit Rising so Fast?
27th March 2023