Real GDP was revised down to 2.2% in the fourth quarter from an initial estimate of 2.6%. A sharp downward revision to inventories was the primary reason for the revision, which leaves less of an overhang for producers to drain in early 2015. Imports were also revised up, reflecting the phenomenal strength of consumer spending Read More
After I wrote this on Twitter (@AdolfoLaurenti):
“Among Eurozone economies, the real divide is between the reformed (Spain) and the unreformed (Italy and France).”
I received a question from @ml8_ml8:
“When you say that Spain is “reformed”, Italy and France not, what do you mean by that?”
My answer is too involved to reply on twitter so I am posting it here with a table compiled by the World Bank that ranks countries for ease of doing business.
By market reform, we mean liberalization of markets for goods and services, labor market reform to add flexibility to wages and contracts, as well as cutting back red tape across the economy. A good proxy is the World Bank ranking on the ease of doing business. As shown in the table, Spain has done a better job on the path to reform, while Italy is lagging. It also shows how France is far from the UK or Germany in competitiveness.