Venice Summer Institute 2019: The Future of Europe: Structural Reforms, Growth and Globalisation

Global productivity growth—the key long-term driver of living standards—fell sharply following the global financial crisis and has remained sluggish ever since. This decline has been associated with subpar global economic growth and record-low real interest rates. If sustained, low productivity growth will have profound adverse implications for progress in global living standards as well as for the ability of macroeconomic policies to respond to future shocks. Structural reforms are often advocated as the main policy response to such concerns. Yet, we still know little about reform drivers, implementation sequences, and the nature and magnitude of their long-term pay-offs. Moreover, reform fatigue seems to have settled in against the background of rising concerns regarding the possible short-term costs of reforms (particularly in a context where monetary and fiscal policy space has shrunk), their medium-term distributive effects, and political economy obstacles to their implementation, which cast doubt on the ability of reforming governments to be re-elected. The aim of the workshop is to bring together a group of leading researchers working on these issues to help map the frontier and distil novel policy implications. Some of the key questions that will be addressed in this workshop are: How do reforms boost growth in Europe and how persistent is their impact? What types of reforms had the biggest pay-offs in Europe, and how do these vary across different countries (e.g., core and periphery)? How are the effects of reforms shaped by the state of the economy and the stance of macroeconomic policies? What are the effects of structural reforms at the macro, sector and firm levels? What are the main political economy drivers of structural reforms in Europe? How costly and frequent are reform reversals in Europe? What are the different reform combinations and sequences that have been tried and what have been their main implications? Do reforms reduce or increase inequality, and how can they be designed to ease a trade-off between efficiency and equity?

Keynote speakers:
Philippe Aghion, College de France, LSE, Harvard, PSE
Ufuk Akcigit, University of Chicago
Romain Duval, IMF Research Department
Paul De Grauwe, London School of Economics