Earlier when the Eurozone is established, the countries have a problem of competitiveness: the growth of wages is much faster than the growth of productivity. This high salary results in high prices with relatively low quality of products & services. This happen to all countries in Eurozone, except Germany. The growth of salary and growth of productivity aligns. This results in cheap products of Germany, so other Eurozone countries import more from Germany, and domestic businesses fail to compete with Germany. More import could mean budget deficit which lead to debt. If the countries leave Eurozone then they go back to competitiveness because their currencies are no longer euro, so the devaluation of their currencies make their products cheap which boost exports. But since all of the countries in Eurozone except Germany are the problems, leaving Eurozone means the Eurozone no longer exist.
I also know that the origin of crisis is the financial institution bad risk management in investment, which resulted in bail-out and then debt.
Question:
- What caused the high growth of Salary?
My argument is that, since Eurozone is created to promote solidarity and reduce inequality, then why not they together promote education? because if the human resource is good then there would not be many problems arise. I suspect that because the officials of Eurozone are corrupted?
