{"id":792,"date":"2016-03-30T08:00:39","date_gmt":"2016-03-30T07:00:39","guid":{"rendered":"http:\/\/blogs.kent.ac.uk\/economics\/?p=792"},"modified":"2020-03-17T12:21:19","modified_gmt":"2020-03-17T12:21:19","slug":"german-wages-and-international-current-account-imbalances","status":"publish","type":"post","link":"https:\/\/blogs.kent.ac.uk\/economics\/2016\/03\/30\/german-wages-and-international-current-account-imbalances\/","title":{"rendered":"German wages and international current account imbalances"},"content":{"rendered":"<p>It is often said that wage moderation in Germany was the primary cause of the current account imbalances in the euro area that emerged prior to the financial crisis. A new study by\u00a0the School&#8217;s <a href=\"http:\/\/www.kent.ac.uk\/economics\/staff\/profiles\/miguel-leon-ledesma.html\"><span style=\"color: #0066cc\">Professor Miguel Le\u00f3n-Ledesma<\/span><\/a> and <a href=\"https:\/\/ideas.repec.org\/f\/pbe760.html\"><span style=\"color: #0066cc\">Dr Timo Bettendorf<\/span><\/a>, a\u00a0Research Economist\u00a0in the Economic department\u00a0of the Bundesbank and former PhD student at the School, puts this hypothesis to the test.\u00a0An article on their research\u00a0has\u00a0featured in <em><a href=\"https:\/\/www.bundesbank.de\/Navigation\/EN\/Home\/home_node.html\">Research Brief<\/a>\u00a0 <\/em>(2nd Edition, March 2016) published by the\u00a0Deutsche Bundesbank Eurosystem Research Centre.<\/p>\n<p>Persistent current account deficits can be problematic as, on account of the rise in external debt that they cause, they have the potential to make economies more vulnerable to shocks. Current account deficits arise when aggregate cross-border expenditure on goods and services, together with income payments and transfers sent abroad, exceed corresponding revenue. While many euro-area member states were posting such deficits, especially in the years prior to the financial crisis, Germany was recording high current account surpluses. Some observers even viewed these imbalances as the root cause of the sovereign debt crisis in the euro area&#8230;<\/p>\n<p>You can read the full article here:<\/p>\n<p><a href=\"http:\/\/www.bundesbank.de\/Redaktion\/EN\/Standardartikel\/Bundesbank\/Research_Centre\/2016_02_research_brief.html;jsessionid=0000XDKRV6D-6aUMI8jsp7CR2q7:-1\">http:\/\/www.bundesbank.de\/Redaktion\/EN\/Standardartikel\/Bundesbank\/Research_Centre\/2016_02_research_brief.html;jsessionid=0000XDKRV6D-6aUMI8jsp7CR2q7:-1<\/a><\/p>\n<p>Plus the article was included on the home\u00a0page of\u00a0<a href=\"https:\/\/www.bundesbank.de\/Navigation\/EN\/Home\/home_node.html\">BuBa<\/a>:<\/p>\n<p><a href=\"http:\/\/www.bundesbank.de\/Navigation\/EN\/Home\/home_node.html\">http:\/\/www.bundesbank.de\/Navigation\/EN\/Home\/home_node.html<\/a><\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>It is often said that wage moderation in Germany was the primary cause of the current account imbalances in the euro area that emerged prior &hellip; <a href=\"https:\/\/blogs.kent.ac.uk\/economics\/2016\/03\/30\/german-wages-and-international-current-account-imbalances\/\">Read&nbsp;more<\/a><\/p>\n","protected":false},"author":37654,"featured_media":607,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[14,70],"tags":[],"_links":{"self":[{"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/posts\/792"}],"collection":[{"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/users\/37654"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/comments?post=792"}],"version-history":[{"count":2,"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/posts\/792\/revisions"}],"predecessor-version":[{"id":794,"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/posts\/792\/revisions\/794"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/media\/607"}],"wp:attachment":[{"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/media?parent=792"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/categories?post=792"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.kent.ac.uk\/economics\/wp-json\/wp\/v2\/tags?post=792"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}