Rising Powers and Economic Crisis in the Euro Area

"De Ville and Vermeiren have developed a completely new and highly original Comparative Capitalism explanation of the Eurozone crisis. They prove that the southern member states suffer from divergences not only in cost competitiveness, but also in product competitiveness. The latter is mainly due to the rise of large emerging markets as competitors. Based on their findings, the predominant Eurozone strategy of regaining competitiveness via internal devaluation becomes even more absurd." (Andreas Nolke, Goethe University of Frankfurt, Germany) "De Ville and Vermeiren pull off a rare feat. They skilfully combine an analysis of EU trade policy outcomes with that of ECB monetary policies by relying on the varieties of capitalism approach. They thus bridge hitherto unlinked research fields, and explain why domestic institutional arrangements differentially affect EU member states' resilience to foreign competition from newly industrialized countries, especially China. International Political Economy - who wins and who loses? - of the finest kind." (Dirk De Bievre, University of Antwerp, Belgium) "Like EU policies since the euro crisis, academic analyses of the events have been overwhelmingly introspective. This book provides a welcome corrective. In fascinating detail De Ville and Vermeiren show the links between two of the most significant geo-economic developments of our time: the rise and fall of the euro, and the emergence of the BRICs as global trade powers." (Hubert Zimmerman, Phillips University Marburg, Germany)

In this book, Ferdi De Ville and Mattias Vermeiren examine the linkages between the economic crisis in the euro area and the rise of Brazil, India and China (BICs) in the global monetary and trading system.

In this book,  Ferdi De Ville and Mattias Vermeiren examine the linkages between the economic crisis in the euro area and the rise of Brazil, India and China (BICs) in the global monetary and trading system.  Drawing on the insights of the comparative capitalism literature, the authors show that the latter development has been a key source of the escalation of trade imbalances in the euro area, which are widely seen as an important cause of the financial and economic crisis in the region. By pointing to the external source of these imbalances and the divergent institutional capacity of the euro area countries to deal with the intensified competition associated with the rise of the BICs, De Ville and Vermeiren go beyond the focus on the divergence in unit labor costs as the driving force of these imbalances. As such, this book provides a comprehensive policy critique of the EU’s export-led growth strategy based on declining unit labor costs.