Must-Read: Mark Thoma Sends Us to Simon Wren-Lewis: Economists and the Eurozone: Wake Up Calls and Political Capture

Must-Read: Mark Thoma sends us to Simon Wren-Lewis: Economists and the Eurozone: Wake Up Calls and Political Capture: “I have often tried… to ask whether Germany’s strange stance on these macro issues…

…simply reflects this different conjunctural position. I think the answer is no…. Germany’s stance reflects similar political economy pressures as you will find in other OECD economies: there is no German exceptionalism, but rather that the forces that everywhere are pushing austerity and tighter monetary policy happen for various reasons to be stronger in Germany. From this perspective, this post from Frances Coppola is particularly interesting. Perhaps the problem at the heart of the Eurozone is that economic policy advice in Germany has been effectively captured by employers’ interests, and perhaps the interests of banks in particular…

And Mark comments:

Economic policy effectively captured by business and financial interests? That could never happen here…