ABSTRACT

Europe's failure in recovering after the crisis has two main roots. The first concerns the growth model followed by the Eurozone before the crisis. The second root relates to the policies implemented in the crisis. This chapter reviews the interpretations that have been offered on the causes of the crisis. It provides an overview of the austerity policies that have been implemented in the Southern periphery (SP) since the beginning of the crisis, which found a partial justification in the interpretation of the crisis and in the European Monetary Union institutions. The austerity agenda contributed to deepen and prolong the recession, especially in the South. The double-dip recession was a peculiarly European phenomenon. The crisis and the austerity measures implemented in the crisis widened the divides between and within the European Union: between core and periphery, within the core and the periphery, and between peripheries. The chapter illustrates the consequences of these policies on the SP's industrial fabric.