Persistent Output Gaps: Causes and Policy Remedies

Persistent Output Gaps: Causes and Policy Remedies

Cambridge September 3-4, 2015

Gonville and Caius College, Cambridge

In many European economies, the recovery following the financial crisis has proven either sluggish or non- existent. Many countries suffer from persistently high levels of unemployment, coupled with sluggish credit dynamics and stretched fiscal budgets. These outcomes put pressure on policymakers to step up the growth potential of their economies, so as to absorb the slack in labor markets and to stabilize debt dynamics, particularly after monetary policy has largely exhausted its options.

The conference seeks to bring together academics entertaining different views about the likely sources and remedies to the European situation. Is anemic growth a cyclical or a secular phenomenon? What supply side and demand side measures are required to remedy the situation? What role is there for confidence traps? What can be learned from the experience of other countries that exited the recession more swiftly? The organizers are interested in empirical and theoretical contributions speaking to these topics.

Keynote Speakers: Gauti Eggertsson (Brown University),  Bob Hall (Stanford University) and Alp Simsek (MIT and CEPR)

Conference Organizers: Klaus Adam (University of Mannheim and CEPR), Giancarlo Corsetti (University of Cambridge and CEPR); Elisa Faraglia (University of Cambridge and CEPR); Gabriel Perez Quiros (Banco de Espana) and Ricardo Reis (Columbia University and CEPR).