Consider Olivier Blanchard and Daniel Leigh: Growth Forecast Errors and Fiscal Multipliers: This strongly suggests to me that of the 7%-points by which Greek growth fell below IMF estimates in 2010-2011, 5%-points of that were due to the fiscal consolidation that the IMF had forecast would be imposed on Greece. Consider that the IMF had … Continue reading Needed: Large Greek Devaluation or Large-Scale Transfers to Greece