Among the intense debate about the European Stability Mechanism, some economists claim that under the ESM conditionalities Italy would finally implement the structural reforms it needs to enhance its productivity and competitiveness. Although economists have asked these measures for years, politicians have been too populist and selfish to endanger their popularity and approve unpopular policies in the short-term, but that would strengthen Italian economy in the long-term. This view is widely shared inside economics departments, also among many students. Despite its diffusion, this claim is wrong because it implies that economics oversteps its boundaries by imposing political decisions in an authoritarian way. In this article I explain my view after having briefly discussed the features of ESM and its effectiveness (when I talk about ESM borrowings I do not mention the unconditional borrowings up to 2% of GDP approved during the last Eurogroup).
In this series of articles Marco Senatore offers an analysis of the current state of economics and the proposal to establish a market for moral, organizational and cultural values. This instrument would reconcile surplus extraction and individual autonomy and therefore economics and ethics, with significant social and political implications.