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Friday, September 01, 2006


jon livesey

Isn't this subject to the post hoc ergo propter hoc fallacy. Wage demand restraint has certainly "followed" the introduction of the EMU, but it is also the case that folk memories of the high inflation of the seventies and eighties are now fading, Europeans are experiencing the wage cost pressures exerted by globalization, and union strength is much less in Europe today is less than twenty years ago.

Wage demand restraint is a widespread phenomenon in the developed world - the article points out that the UK and Sweden see similar effects - so it's a bit odd to point to one currency, or the EMU, as a key issue. It seems like an example of the Euro-blinkerism that's common in the EU today, that wants to see the Euro as a factor in just about anything, good or bad.

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