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Euro’s Greece rupture - what role has labour played?

Comments on David Vines “Greece and the vulnerability of the European Monetary Union”, 16/05/2010, http://www.eastasiaforum.org/2010/05/16/greece-and-the-vulnerability-of-the-european-monetary-union/

The above analysis has obviously some truth. However, it, as with many commentators and economists, relies on rigid of internal members, especially labour rigidity between member countries.

Leaving the conflict between monetary union and fiscal independence of Euro countries aside for the moment, why hasn't labour moved from other members to Germany in response to its higher wages, say flowing from its good fiscal and economic management?

If labour moves in response to higher wage opportunities, the market would have been able to gradually restore relative competitiveness between Euro member countries, at least in the longer run.

Why didn't that work? Because of cultural, language, or whatever reasons?

Understanding these factors may be helpful to the future and to future policy development for Euro.

Perhaps I should add that by labour move between countries I meant to include first of all the unemployed in the slower growing members.

Even by the employed labour, it should create more opportunities for the incumbent local unemployed ones to find jobs, at least easier.

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