Tuesday, May 02, 2006

Tabellini on Italy

Italian economist Guido Tabellini on the challenges facing his country:
The budget deficit is again out of control, and well over the 3%-of-GDP Maastricht ceiling. The aging population is straining the public pension and healthcare systems beyond sustainability. The manufacturing sector, squeezed by stagnating productivity and competition from China and other low-cost producers, is no longer competitive. Many services remain inefficient, because they are either in the domain of an archaic public administration or enjoy monopoly rents created by regulatory barriers.