Two Effects of the European Financial Crisis

• Authors: Edgar J. Saucedo Acosta , Samantha Rullán Rosanis
• Languages of publication: EN

Abstracts

EN

Background: The European financial crisis has affected most of the EU member states, and European institutions have had to create new financial instruments to counter the impact. Most effects in the economic and political spheres can be attributed to high unemployment and changes in governments in peripheral countries (Greece, Ireland, Portugal, Spain and Romania). Objectives: The aim of this paper is to demonstrate the economic and political effects of the European financial crisis in some peripheral countries that have implemented austerity policies. Methods/Approach: The methodology used is mixed: an analysis of the primary economic variables of the selected countries in comparison to those of countries with low-risk premium was performed, and the relation between the bailouts and elections was presented. Results: The exacerbation of the crisis in the Eurozone is mainly due to the high political costs of austerity measures and not the high level of public spending and/or the alternations in the governments of peripheral countries. Conclusions: The European financial crisis is primarily a result of weak economic governance, and its effects are differentiated. The peripheral countries possess the highest rates of unemployment, and there is a higher tendency towards political instability in rescued countries.

Keywords

EN

financial crisis; governance; bailouts; European institutions; peripheral countries; E00; G01; F15

• Publisher: Sciendo
• Journal: Business Systems Research Journal
• Year: 2014
• Volume: 5
• Issue: 2
• Pages: 46-60

Dates

received

2012-12-19

accepted

2013-06-11

online

2014-09-10

Contributors

author

Edgar J. Saucedo Acosta

• Institute of Economic and Social Studies, University of Veracruz, Mexico

author

Samantha Rullán Rosanis

• Institute of Economic and Social Studies, University of Veracruz, Mexico

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Identifiers

DOI

10.2478/bsrj-2014-0009