European Economic Governance in the Age of Turbulence
Edited by Carlo Secchi and Antonio Villafranca
Carlo Secchi and Antonio Villafranca The beginning of the new millennium appeared to pave the way to the success of the liberal model on a global scale. The striking growth of the emerging economies, together with positive growth rates in developed countries, was expected to give rise to a win-win situation which could make significant pay-offs available to everybody. The current severe economic crisis may represent a rude awakening from this ‘liberal dream’. A crisis that originally seemed to be rooted in American problems and miscalculations, has shown its seriousness by affecting the entire world and changing its nature from a strictly financial to an economic crisis. The race towards continuous growth has come to a halt and a period of systemic crisis has started. In other words, the most striking features of the current crisis are not only its systemic dimension but also the clear-cut demonstration of impressive and strict linkages between the international financial system and the real economy. An analysis exploring these linkages and the effectiveness/sustainability of the measures undertaken by states (particularly the European ones) to face the crisis is therefore required. The initial bankruptcy of Lehman Brothers and the ensuing negative spiral in the banking system may represent a good starting point for such an analysis. These events have led to sweeping changes and unexpected state interventionism in the economy in just a few weeks. In an increasingly uncertain context verging on real panic, some people have raised doubts about the liberal system itself and...