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Latvia and Greece: Less is more. CEPS Hi-level Brief, 12 February 2014

Biggs, Michael and Mayer, Thomas (2014) Latvia and Greece: Less is more. CEPS Hi-level Brief, 12 February 2014. [Policy Paper]

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    Abstract

    Despite considerable differences, there were also many similarities in economic performance between Latvia and Greece before their respective adjustment crises. After the immediate crisis, however, economic activity rebounded sharply in Latvia but continued to contract in Greece. This paper argues that this difference was due primarily to developments in credit. In Latvia credit growth fell sharply, and the economy was deleveraging aggressively by 2009. When the pace of deleveraging started to stabilise, the rebound in the credit impulse caused domestic demand growth to recover. Real GDP has increased about 20% since reaching its trough in the third quarter of 2009.

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    Item Type: Policy Paper
    Subjects for non-EU documents: Countries > Greece
    Countries > Latvia
    EU policies and themes > Policies & related activities > economic and financial affairs > economic policy
    Subjects for EU documents: UNSPECIFIED
    EU Series and Periodicals: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > Centre for European Policy Studies (Brussels) > CEPS High-Level Briefs
    Depositing User: Phil Wilkin
    Official EU Document: No
    Language: English
    Date Deposited: 22 Dec 2014 14:17
    Number of Pages: 12
    Last Modified: 22 Dec 2014 14:17
    URI: http://aei.pitt.edu/id/eprint/58500

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