by Jim Rose in currency unions, economic growth, Euro crisis, macroeconomics Tags: Eurosclerosis, Greece, Italy, PIGS, Portugal, Spain

Figure 1: Real GDP per Portuguese, Italian, Greek and Spaniard aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1955-2013

Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics

Figure 2: Real GDP per Portuguese, Italian, Greek an Spaniard aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013

Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics

Note that a flat line in figure 2 is growth in real GDP for that year at 1.9%; a rising line is above trend rate of growth; and a falling line is below trend rate growth for that year.

The PIGS had three distinct phases in their post-war growth. Rapid growth up until about the mid 70s. Growth at about the trend rate of growth of 1.9% until about 2000 in the case of Italy. This was followed by slow decline then rapid decline after the global financial crisis.

Figure 3: Real GDP per Italian aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013

Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics

Greece had a different story with the long decline between 1979 to 1995. This was followed by 10 good years of growth followed by sharp decline with the onset of the global financial crisis.

Figure 4: Real GDP per Greek aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013

Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics

Portugal was in a boom In the 1980s and 1990s followed by what borders on a depression since about 2000.

Figure 5: Real GDP per Portuguese aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013

Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics

Spain had a pretty good run from the mid-1980s until the eve of the global financial crisis with somewhat above trend growth after a period of decline in the 1970s.

Figure 6: Real GDP per Spaniard aged 15-64, converted to 2013 price level with updated 2005 EKS purchasing power parities, 1.9 per cent detrended, 1955-2013

Source: Computed from OECD Stat Extract and The Conference Board, Total Database, January 2014, http://www.conference-board.org/economics