La enseñanza de la política económica en la universidad sigue reproduciendo la idea de que la disciplina es una rama ancilar de la teoría neoclásica, especialmente de la versión tradicional del equilibrio económico. En este mundo el orden económico emerge de manera involuntaria como resultado de las interacciones que los agentes realizan a través del mercado. La política económica sirve para cubrir las deficiencias que puedan surgir en el camino hacia el equilibrio, ya sean éstas debidas a la falta de flexibilidad en precios y salarios, o a la imposibilidad de proveer determinados bienes y servicios a través del mercado. En este trabajo se aportan algunas ideas para fundamentar otro tipo de docencia para esta disciplina. La idea central es que el orden económico hay que “fabricarlo” mediante el recurso a las instituciones. El análisis del origen y funcionamiento de las instituciones se convierte de esta manera en el verdadero objeto de investigación de la economía. En la versión que ofrece la Nueva Economía Institucional la política económica se asocia con el diseño de las reglas formales que generan la estructura de incentivos más adecuada para disminuir los costes de transacción. En la versión que ofrece la Economía Institucional la política económica se asocia con la consecución de las reglas formales que mejor contribuyen a alcanzar los objetivos que se identifican con las preferencias sociales de los individuos.

One of the instruments used to combat poverty among the elderly is the minimum pension. In Spain, minimum pension is yearly set by government and has a positive effect on income redistribution between regions. In this contribution we analyze and quantify such redistribution. Results show that pensions in regions with low per capita income draw higher amount of supplement than regions with high per capita income. In short, the positive effect of the minimum pension on the income redistribution of the retired population is associated with a relative pension benefit improvement for pensioners in poor regions (above the national average).

Purpose The authors’ goal in this paper is to study if there are long-run effects on the wages of those workers who entered the labour market overeducated but who have, over time, been able to overcome this situation by obtaining a job for which they are correctly matched. Design/methodology/approach This study universe is constituted by workers entering the labour market with a university degree between 2004 and 2012. The age range of these individuals is between 22 and 35 years old. With the data of the 8,359 selected individuals, the authors have constructed a balanced panel covering the period 2013–2017. This methodology is developed in two steps. First, the authors estimate a wage equation with the traditional variables and, second, the authors use the estimated coefficients of these variables to predict the wage paths of a representative individual in each group. Findings The main result the authors obtain indicates that the wages of those who manage to overcome an initial situation of overeducation do converge but very slowly to the respective wages of those others that entered the labour market correctly matched from the beginning. The authors consider this result to point towards the existence of scarring effects in wages induced by an initial situation of overeducation. The authors also present evidence, beyond education, about the influence that the occupational characteristics that a worker has on wages. Research limitations/implications The factors that can influence the catching-up of wages are multiple, and it is not feasible to test all of them empirically. Therefore, the wage convergence process the authors present may also be influenced by other variables for which the authors do not have information. Practical implications This paper contributes to different branches of the labour market. First, the authors present new evidence within the literature dealing with the so-called scarring effects on wages related to the conditions entering the labour market. Secondly, this study’s results provide a new argument that complements those developed so far that explain a reduction in the wage skill premium detected among young graduates in Spain. Finally, this paper contributes to advancing research about the effects that overeducation has on wages. Originality/value The question the authors are attempting to answer in this paper can be formulated in the following terms: when a worker manages to overcome an initial situation of overeducation, what happens to his/her wage? Will it adjust quickly to the new working situation, or will we observe a slow convergence to the wages of workers with an employment history without overeducation situations? To the best of the authors’ knowledge, this topic has not yet been studied. Researchers have mostly focused their attention on comparing the wages of overeducated workers with the wages of those who are correctly matched. In this case, the authors compare the wages of correctly matched workers, but with the difference that some were initially overeducated and others were not.

This paper explains the economic policy developed in the euro area to manage the economic effects induced by the COVID health crisis. First, an overview of developments in the euro area is presented. It then explains the fiscal decisions taken by member countries, as well as the monetary policy pursued by the European Central Bank. The final part reflects on the advisability of abandoning the fiscal rules that limit the fiscal capacity of states in order to favor economic recovery once the health crisis has been overcome.

One of the main impacts of the Great Recession has been the increase in the rate of unemployment in Spain. Unemployment has a negative impact on the wages of workers, which, in those pension systems where pensions are computed according to wages, eventually affect pension benefits. In this contribution we estimate the impact of these detrimental effects on Spain’s pensioners’ welfare. According to our estimates the average pensioner is expected to lose the equivalent to 18 monthly payments of the initial pension entitlement. Additionally, the poverty risk faced by pensioners is estimated to increase between 10.6 and 24.6 per cent due to the effect of the Great Recession.

Uno de los impactos principales de la Gran Recesión ha sido el acrecentamiento en la tasa de paro. El desempleo ha tenido un impacto negativo sobre los salarios de los trabajadores que se ha trasladado a las pensiones, cuando los sistemas de cálculo de éstas últimas rentas dependían de aquellas. En este trabajo, se estima el impacto de estos efectos negativos en el sistema de pensiones español. De acuerdo con nuestras estimaciones, el pensionista medio padecerá una pérdida equivalente a 18 meses de pagos sobre la pensión inicialmente estimada. Adicionalmente, el riesgo de pobreza se estima que aumentará entre el 10,6 y el 24,6 por ciento debido a los efectos de la Gran Recesión.

Empirical evidence has shown the existence of a negative relationship between the rates of unemployment and real wages. If pensions are computed according to the wages that workers have contributed, then the unemployment rates during working life may also influence the pensions to which they are entitled. Using data from 2005 to 2012 for the Spanish social security system, we estimate that the unemployment elasticity of real pension is -0.135. A 1% increase in unemployment rate is associated with a reduction in pension equal to 0.135%. In normal times', this value could be considered modest, but the Great Recession has increased dramatically the rate of unemployment. In 2012, the rate of unemployment in Spain had increased to 25.7% and in 2015, it had diminished to 20.9%. It is estimated that unemployment rate will not be returned to figures existing before the crisis until middle of the next decade. Moreover, the current reforms in social security systems could interact with the future effects of the current rates of unemployment and cause future pensions to be significantly lower than those estimated by individuals. The economic welfare of the future cohorts of retirees would then be significantly worsened.

In the first part of the paper we confirm the existence of a financial “vanishing effect” for the Eurozone countries since the 90s. In the 70s and 80s -when credit over GDP was still moderate- credit growth still had a positive effect on real growth, but thereafter during the financialization heydays when credit reached a high level, that link broke apart. In the second part we put forward that a main reason explaining why increasing financial deepening stopped to have a positive effect on growth might be due to NFCs having used an important part of their external resources for the acquisition of securities instead of financing real investment. This process of NFC finacialization and the observed increase in their selffinancing ability are two key reassuring indicators showing the disconnection of NFC financial behaviour with their investment decisions

In this paper, we survey and analyse the economic literature on global and European imbalances and their connection with the global financial crisis. In the years preceding the crisis, there was increased attention to the existence of large current account imbalances among large economies worldwide. Research and policy papers divided into two positions regarding these imbalances. Some authors viewed global imbalances as part of a new equilibrium in the international financial system. Others urged policy intervention to reduce these imbalances. The Great Recession revived the debate over global imbalances and their influence on the gestation of the crisis. However, more recent work has clarified the relationship between the crisis and global imbalances, emphasising the roots of the crisis in financial liberalisation and the fragility of the international financial system. From this perspective, we highlight the need for deeper analysis of gross capital flows and the need to monitor credit levels as measures to prevent future financial crises.

The New Consensus Macroeconomics and the consequent macroeconomic policy strategy implemented before the current financial and economic crisis had downgraded the role of fiscal policy. Discretionary fiscal policy should be abandoned, leaving room only for the working of built-in stabilisers. Fiscal deficits had to be avoided, setting strict limits to the circumstances in which this fiscal imbalance could operate and to the maximum size of the fiscal deficit. However, this view has changed since the start of the crisis. Thus, recent research confirms the validity of the Keynesian arguments in favour of an active counter-cyclical fiscal policy and the problems generated by the fiscal austerity policies whose only objective is the drastic fall in fiscal imbalances. The objective of the chapter is to show the main principles and guidelines of what should drive the fiscal policy in Spain in the future.

The aging process we are witnessing in the majority of developed countries is raising financial sustainability problems in the pay-as-you-go pension system. The reforms designed to re-establish the financial equilibrium of pension systems may put one of the most important objectives of these systems at risk: to reduce the poverty rate among the elderly. This paper studies the effects that the reforms implemented in the Spanish pension system would have on the poverty rate of the retired population. The two main novelties presented are the following. First, the collective under study is focused on the most vulnerable workers. Second, the effects of the reforms are studied taking into account the labour market situation of the individuals in the years prior to retirement.

Opposite to mainstream economics, (post-) Keynesian economics has defended the need of a discretionary fiscal policy that helps to maintain economic activity at a full employment level, offsetting the cyclical deviations from that level of output. In this sense, it is implicitly assumed that any discretionary management of public finance is, by definition, efficient. The Spanish case shows that public authorities can make an inefficient use of the discretionary room of fiscal policy, thus exacerbating the existing macroeconomic and fiscal imbalances. Consequently, there is a need for rules that constrain the discretionary management of public finance.