Ja da, ja. Så, nu skal vi holde igennem den. Ja, og her. Her. Du ser bare ikke til. Ja. So, welcome to beautiful orhus and sunny orhus, where we are hosting the Europe's Growth Challenge Event. And now, our manager, Simen Djankov, is arriving. Welcome, welcome to the event, where we have created beautiful inside stories for you from the panel. Okay, super. So, I'm standing here with Simen Djankov, the keynote speaker, and I was just asking him what his expectations are for today and what he hopes to learn from the panel debate. The main goal for me in terms of the debate today is to learn what the Danish view is on many of these topics. We've heard the view from Brussels. We've heard the view from London. We've heard the view from Eastern Europe. But the Danish view is not so widely discussed across Europe, so I hope that some of the discussion will falls on that. Okay, so Denmark is a relatively small country, both in size and economics. So do you think that the Danish way can contribute to the overall economic state of the world? Could other countries learn from Denmark, or are they simply too small? No, being small doesn't make it difficult to bring good practice. This can contribute to the growth of many of the good examples. Since it's easier to do big forums, so actually if you can learn along from Denmark. Okay, thank you very much. Thank you, sorry, I was about to sneeze the whole time. It's okay, just go over here, thank you. So once again, welcome to Aarhus. Welcome to beautiful sunny Aarhus. We're here at the Europe's Growth Challenge Event, hosted by Faka and Aarhus Business School. So basically this event is organized by volunteer students from the student association called Faka. Faka is a student association where we try to link our members with business partners to say and to show people that there is actually a world outside of these yellow buildings outside of the university. Currently we have 1500 members all over the university with different study lines. We are collaborating with 18 top tier partners to try and link again, as I said, these members to the partners and to show them what they can actually do in the real world. And we are also hosting this together with Aarhus BSS, which is one of the four main faculties of Aarhus University, a triple crown accredited business school, more than 16,000 students. So to help us host this event today, we also have some partners and sponsors that we would like to thank. First of all, we have two more fundings, we have Mahill Olsbens Mercedes-Benz, the Department of Economics, and also a two ball research center. So now our next contestant or our next guy is arriving. So let's see if we can see who it is. It is Bo Sandemann Rasmussen. Maybe we should also hear a word from him. So Bo, do we have time for a short interview? So Bo, thank you for coming. What do you hope to learn from this panel debate for this event? It will be interesting to hear about Simon's view on how we can increase growth in Europe, because it has been a long time since we have significant growth in the EU area. So we are hoping to hear some good points on what should be done. Yeah, and Simon also said that he hoped to learn something about the Danish way, because it is a small country and you are not, we are not heard that much in the economic debate. So do you think that Denmark has anything to teach a guy like Simon on how to do economics? I know he is very much concerned about a kind of fiscal consolidation, and that Denmark really has done a good job in the past five or six years. So I am quite sure that what we have done here could be copied in other European countries and that could help also establish growth in Europe. Thank you very much, Bo. So that was Bo Sandemann Rasmussen. I don't know if we have any more participants arriving, but let's wait and see if there are someone. So just random students I think. Maybe not. So maybe I should tell you a bit about today's event. So basically the event today will be on Europe's growth challenges. It's going to be put into four different parts. So first of all we have Simeon Djankov hosting a public lecture for around 450 students. Then we'll have a short break, and afterwards we're going to have a panel debate, where Simeon Djankov is going to debate Europe's growth challenges with other panel debatees, who are Bo Sandemann Rasmussen, as we just met. Also Philipp Schröder, professor in economics, and Clemens Jarta, senior partner of McKinsey & Company. And to host the debate, we have Bjarke Møller, who is director of the Think Tank Europe. And now I can see we have more participants arriving. And it is Philipp Schröder. Philipp, do we have time for a short interview? So Philipp, welcome. What do you expect to learn from this event? Well I think what Simeon has brought for us is a new diagnosis of what is wrong in Europe. And I'm very much looking forward to hear his remedy, because it's one thing to prove that the European model is sort of failing. It's a very different story to find out what to do about it. I'm curious to challenge him on some of the ideas he has for what we should do going forward, and securing that Europe still is on a gross pass. Do you think he can learn something from Denmark, a relatively small country? Well I've looked into some of Simon's research material, and what he does actually takes a lot of the European models from Scandinavia, also from the Baltic countries, and sort of asks which elements appear to work well, and could we sort of scale them for Europe. And in that respect I think Simeon has learned a bit from the Scandinavian model. But again I think some of us in the panel will challenge him on, if he understood everything right, or if it can actually be scaled in the European contracts. Because having seen a couple of European countries, and lived in a couple of European countries, for me not obvious that you can use what worked in Estonia, and just imply that it also works in Germany. Okay, thank you so much, Philipp. You're welcome. So now we only need the last panel debater to arrive, Clemens Jata. So while we're waiting for him, I'm just briefly going to tell you about who the guys that we are meeting actually are. So leading the panel debate we have Bjarke Møller. And Bjarke as I told you is the Executive Director of the Think Tank Europe, and he's also a leading Danish journalist. Furthermore, he is an active participant in public debates concerning European issues. He's also a former editor-in-chief of the newspaper Mandamorn, and he holds an Executive Leadership Degree at Columbia University at the Graduate School of Journalism. Furthermore in the panel we also have Simen, as we also have Medt, who is a professor at LSE and also at Harvard University. He's the former Vice Prime Minister and the Ministry of Finance in Bulgaria. And he's also been the former Chief Economist and Vice President of the World Bank. He holds a PhD in Economics from the University of Michigan. We hope that he can provide the holistic perspective and that he can, from his point of view in America, Bulgaria and also in London, can provide some overview of the challenges that Europe are facing within growth. Furthermore, as we just saw, we have Philips Rødder, who is a professor at Aarhus BSS at Aarhus University. He's also a board member of the Danish Competition and Consumer Committee. He's a former board member of the Danish Productivity Committee. Philips Rødder has worked a lot with productivity and how to create more productivity in the Danish economy. Furthermore he holds a PhD in Economics from Aarhus BSS. We also have Clemens Jartar, where we are actually waiting for at the moment. He is a senior partner and director at McKinsey & Company. He is a member of McKinsey & Company's European Leadership of Business and Technology practice. And he is a global advisor to clients in the area of digital strategy and disruptive technologies. And he is going to take over the spot that was actually for Bjørne Korridan, but he had unfortunately to cancel showing up at this event. So Clemens will take his place. And finally we have a guy we also met, Bo Sætterman Rasmusen. Bo is also a professor at Aarhus BSS Aarhus University. He is a former board member of the Danish Competition and Consumer Authority. And he is a former board member of the Danish Tax Commission. Han holds a PhD in economics from Aarhus University. And now we have the final panel DBT arriving, I think. Or at least I see a car. Hmmm. Hmmm. But they look a bit empty. So let me just hear. Hansen, do we have anyone left? Okay. And now we have Jens Ries arriving. But let's move inside and see if we can talk to some of the participants about the event today. Well, let's see. It looks like all the participants have already sat down at their chairs. So maybe we should just switch to the other camera. And let the show begin. Har vi den her på? Ja, det har vi. To. So now that the chief advisor to her Majesty's government is here, I think we can safely assume that everybody is here. Your Excellency, ladies and gentlemen, Welcome to Aarhus University School of Business and Social Sciences. My name is Pierre Belso Argo. I am the Vice Dean of Research and Talent. The latter meaning mainly PhD education. It's a great pleasure to be here and also sort of looking to the back rows and noticing that they are also filled. So we have a grand theme. Therefore a grand occasion. And this is, and I should notice, this is organized by the student organization FACA here predominantly. Maybe with a bit of help from the department in terms of financial support, I take it. It is indeed a great pleasure to welcome you all on behalf of the Vice Chancellor of Aarhus University and the Dean of the School of Social Sciences. Today we are going to talk about Europe's growth challenges in a bit FACA will introduce the speakers of this afternoon. Of course Europe's growth challenge is indeed a major one and I guess probably the largest challenge bar none to people, economics and business etc. Others might say that there are other challenges as grand.  So I'm hoping to sort of have someone answer questions like is Europe really doomed for a slow decline? Similar to that of the West Roman Empire some 1700-1800 years ago or might there be a way out or forth and what may that way if there is indeed one involved so I'm certainly hoping to hear presenters and the panel touch upon things like presumably migration, aging is that a problem or is it something we can use meaningfully, can we be proactive in terms of migration rather than sort of defensive and wall building? Now technological developments I've heard well I am an econ person but I don't follow sort of the most recent news but one of the things I noticed was that Denmark in particular seems to have been performing really poorly since sort of the financial crisis or the economic crisis if you want so is there something here for us to learn from listening to speakers from other places who have chosen to share their ideas on growth in Europe? So that's one thing I presumably also one would expect to hear something about digitalization the import of IT into sort of all the grains of the economy what might that entail is this going to be jobless growth and therefore maybe more inequality or is it going to be job left growth or things like that so I'm truly looking forward to hearing the answers but ideas on how to think about these things in order to arrive at answers sometime eventually and hopefully in not too distant future so with those few words since we have an exciting set of speakers and a panelist in front of us I'll leave the floor to Boris Georgiev who is by the way a Bulgarian native and I think have been instrumental in making sure that we can actually present our main speaker of this afternoon which Boris will do in a bit alongside the panel and Boris is here also representing FACA who are the organizers so take it away guys So ladies and gentlemen Welcome on behalf of the Finance and Consulting Club in Aarhus Welcome to Europe's Growth Challenge 2016 On behalf of FACA I would like to welcome you to this event which we believe comes at a very unique time not only for Europe, not only for Denmark but actually for the entire world This is why we think it's very important in our club at least to engage all fellow students the community, the business society as well in those very pressing challenges because they not only affect how we live today but they also affect how we live tomorrow in 5 and 10 years This is why we've taken on the mission in FACA to try and engage with the world's perhaps most prominent most influential experts both in the business world as well in the academic world and also in the policy making This is why it's great pleasure to have the opportunity to introduce you to the program for today First of all we're going to hear a public lecture on Europe's Growth Challenge delivered by Professor Simeon Diankov Furthermore we're going to pause for a 15 minute break where you can enjoy in the upper S building drinks as well as some chocolate and other confectionery Afterwards we're going to transition with a panel debate which is going to feature three other prominent business and economic experts So in our lineup we have Professor Philipp Schöder from Orhus BSS as well we have Clemes Jara who is a senior partner and director at McKinsey & Company Denmark and as well Beau Sandema Rasmussen who is a professor at Orhus BSS as well Without further ado let me introduce the main public lecture today So Professor Simeon Diankov Bulgarian native has been a former Vice Prime Minister and Minister of Finance of the Republic of Bulgaria in the period 2009 2013 Prior to that he spent more than 14 years at the World Bank starting as a consultant and at the end reaching the level of president and as well chief economist of the World Bank Before several years he also used to be a rector of the new economic school in Moscow Russia Currently he is a professor at the London School of Economics and Political Science He not only has been very involved in policy making and the most pressing public debates worldwide but also during his tenure at the World Bank he has conducted numerous projects for governments in transition in North Africa as well as the Caucasian region and has advised numerous governments on their most important problems that they have faced Furthermore he has been extremely active in the academic field during his career he has managed to publish more than 70 scholarly articles among what you may call some of the most influential economic journals and I believe his expertise and mix between expertise from government politics as well as economics makes him a unique guest and a person who definitely we can learn a lot from from his public lecture Without further ado let me introduce Simon Djankov London School of Economics and Political Science Thank you very much Thank you very much Frankly I am quite surprised to see such a large interest in this topic I have presented on similar issues in a number of other European countries and interest has been there but nowhere such such a large interest so I really look forward to today's presentations we have organized them in a way that I would first be an economist so I show you some economic facts economic and social facts about Europe just to lay the foundation for what then I hope would be a discussion for not only what are the problems but also what are some of the solutions to these problems at least that that we can discuss and I would start first with this very basic figure I should mention that you don't have to be an economist hopefully you don't have to be an economist to follow the discussion and participate in the discussion today as long as you understand this particular figure which is essentially looking at the last roughly 65 years of Europe's economic development very soon after World War II this is the average of all of Europe as we know today the European Union as you know as we know today and noticing that every decade also growth goes down and down and down to the point where the official statistics of the European Union the so-called Eurostat the European Statistical Office basically predicts that if things go the way that they are going now the decade of the 2020s or just in five years time basically would be a no growth decade all between zero and one percent growth on average for the European Union in other words stagnation så by the time that many of you joined job market or start looking for careers in business or in government or in other walks of life the opportunities would be not as good as they were in previous previous decades on this chart incidentally also see how painful the recent eurozone crisis was or the financial crisis in Europe this very big spike downwards 2009-2010 Europe then recovered somewhat but you see that rather than go continuing to go up after 2010-2011 growth actually has again been essentially around zero to one percent so what we will be talking today both in my presentation and in the discussion is what are some of the reasons for this low growth how it compares to the main competitors of Europe that is the United States or America more generally and rising Asia and then what can we do about it and I will have the luxury of suggesting some solutions but leaving it for the rest of the panelists to provide the main solutions in most of what I will do I will compare where data exist between Europe and the United States and you would see towards the end hopefully was the rationale of this partly it's data Asia which is also a main competitor of Europe doesn't have as long of time series but where it does we will be showing that as well but again if you now go about 45-50 years history and look at the until recently original EU-15 and the United States you'd notice that until about the Eurozone crisis so until 506 years ago Europe on average was actually producing together the EU-15 were producing more than the United States economy this fact is often because the US economy and especially in the new technology sector has been so dominant in recent years people forget that if you look at long term statistics Europe actually has been bigger than the US economy for most of our modern history but just around 2011-2012 that ceases to be the case and now the American economy largely on the expansion of new industries has overtaken the European economy in terms of overall production and then what we are going to do in a series of charts so I'll show you a lot of data and then we'll have more of a discussion I'll show you a dozen or short charts to basically start asking the question where is Europe lagging so what's happening can we find this from looking at different markets so one market if you want to produce if you want to have economic growth it's useful to have people who actually produce people who are gainfully employed in the economy so one thing that we will be comparing is the employment rate this is not the same as an employment or employment basically the employment rate says of the people who are of working age so if you exclude kids and if you exclude people who already retired so you just leave people who can work what is the percentage on average in countries that are actually employed so the opposite of that would be people who have decided not to work for one reason or another or have reasons not to not to work the higher this percentage is obviously it means that the more of the active population is involved in economic activity and that's better for the economy so first just looking at the last tool and notice that here the statistic includes all European Union 28 including Croatia so we are completely up to date in this analysis we already notice that there is really a 5 percentage points difference between how many Americans work and how many Europeans work so already we see that a sizable part of the people who may work in Europe have decided not to more so than in the United States and then it's very interesting to look across countries incidentally one topic that for me has been very interesting coming out of Eastern Europe is to compare Eastern Europe to Western Europe but also Southern Europe to the rest of Europe the first country perhaps is not surprising but is just striking how different it is so basically in Greece more than half of the active working age population does not work it's quite a striking striking statistic to ponder so these are not students these are not people who have not grown to be in the market and these are not retired people these are the people between the ages of 18 and 64 that in principle should be involved in economic activity so in Greece about 48% of the working age population is involved in such activity so more than half actually not the rest of the population in other words has to produce for them as well if you look at this graph you quickly say well it's no surprise that Greece has lots of economic and financial problems but I've put a number of countries first to say that Denmark does very well on this on this chart and that in particular it's one of the few countries that outperformed the United States there are 6 or 7 European countries that outperformed the United States in terms of employment rate notice that they are primarily in the northern part of of Europe exception is Austria which is in central Europe but Sweden, Netherlands, Denmark the UK, Estonia our countries where more than 70% of the population working age population works and basically the more you go from north to south of Europe to southern Europe population decides that maybe working is not such a good idea there are other things that are more exciting to do than work we'll find later on what this results in then we look at another statistic which is of the people who work how much do they actually work so how many hours do they actually how many hours do they actually work and here I compare again the United States to France a country that typically is not thought as the most hard working European country but I purposefully picked France just to point out that if you go back 50 or so years the average French worker was actually working about 15% longer than the average American worker this is annual annual data how many hours a year you work so France is in the red about 2200 hours on average a year the average French worker about 1950 hours in the US but you go over time and somewhere in the early 80s that changes and it changes then dramatically and continues to change over time where basically Europeans work less and less Americans basically have kept up pace so they've reduced a bit the working load but not too much so it's a very stable line if you look at some of the Asian countries on this line for example career you would see much higher average working hours and basically a straight line so they work and they work consistently year after year so there is no let's say trade off between working hours and having fun but in Europe we like to have fun and we have more and more fun over time so few people work and these who work don't work as much we learn from these two pictures now we go to a different topic and say well so we don't work as much those who work also take more time but maybe we are much smarter and as a result we don't have to work as hard because we are better educated so this panel basically looks first at high school education secondary education and then I'll go to university education that may be more interesting for you this also is quite a striking chart to me at least one of the most striking charts in this analysis so the question is very simple not how good a student you are but how many students who start high school graduate and I should say that there are wide differences within the United States across states so the further south you go the more students graduate but on average in the United States nearly 90% 9 out of 10 students graduate 88.3% in Europe it's 10% lower so 78% of students in high school graduate but again notice who are the outliers so to speak the countries in red so these are essentially actually not essentially but completely countries without exception and because these numbers may be hard to believe at least to some of us I hope they are hard to believe let's just read one or two countries so what this number means that in Portugal let's say that of the class that enters high school at age 10, 11 12 only 40% graduate so the rest of the high schoolers basically leave school before actually they have a high school diploma and start either working or not working as we've seen seen before so in other words attrition is huge and again notice the pattern of southern European countries being particularly pronounced in having very little comparative education and completion rate the more you go towards eastern Europe and northern Europe you see high and high high and high completion rates you see here some of the east European countries that look quite quite well basically because high school education was mandatory under socialism so you had to graduate so if you go 10-15 years back in time it would be 100% for countries like Lithuania, the Czech Republic, Poland and so on, even Bulgaria it's starting to fall fall down but critically you see southern Europe where if you continue to follow this logic not many people work those who work don't work much but those who work not as much actually not that well educated many of the people who drop out joined the labor force early and then we go to universities I was recent just in discussion with some of your faculty and we discuss some of the university reforms that have gone on over the last decade also here in Denmark in trying to aglomerate universities and bring higher quality as a result incidentally the Bulgarians in the audience may know that I tried when I was deputy prime minister to do the same reform in Bulgaria and miserably failed did not work at all I had all of these esteemed professors coming and saying what do you know about education well I'm reasonably educated I've taught in a number of universities you don't know anything about education so it didn't work out but let's compare the two there I think by now four different international indicators rankings on university quality you can argue that some of them are biased so for example the financial times ranking even though it claims it's unbiased has many British university and given that the financial times is British you know it looks a bit suspicious the Shanghai index which you can imagine is somewhat related to Shanghai and Asia has more Asian universities among the top but that's why we take several so I show you the two main ones and it just ask the question all together all universities in the world let's rank them on quality of education and see where they are not surprisingly the vast majority are in the United well not the majority quite actually yes the majority above half of them are in the United States and in the case of the Shanghai index over 65% actually in the United States the UK has some, the Oxford the Cambridge I think the London School of Economics also makes it but then you look at continental Europe so continental Europe is all of the European Union except for the UK and basically you notice that on one index there are only two and on the other index there are six European universities all together that are in this index so basically it's either 3% 2-3% of the top universities or 10% of the top universities in the world given that education, university education as we know it started in Europe centuries ago you know this is not great legging behind very significantly behind the US, the UK and increasingly Asia the others are basically Asia, I'll come to this point in a bit more detail later I'm at the end of this random what may seem to be to your random pictures, I'll come to a point very soon but let me show you two more graphs so one other topic that is very discussed not just in Europe but across the world on how do you grow basically by bringing more educated people more creativity, more innovation is asking this question of if you take the hundred largest European companies, the US companies basically rather than saying they are in these sectors and they are subjectively this creative or that creative let's basically assume that the newer the company the more innovative it is it's not always the case but let's assume to a first approximation that companies that were established more recently perhaps because they have better technologies or because they are in new sectors have more innovation and then you just look among the hundred companies in Europe and the US how many I established before 1950 and how many I established more recently basically the answer from this graph is that Europe has longstanding companies that haven't really changed much in terms of the mixture of top companies in Europe while in the United States nearly half of the companies are relatively new so this would be the Microsofts and Google's and Facebook's and so on but not just high tech companies there are many other sectors for example energy where in the United States there are a number of new companies that have been created just in the last decade or so so what this shows in other words maybe it doesn't show it but it's a manifestation of the ability to innovate and to grow very fast given that you start from scratch that you essentially start up that is we'll talk in a minute depends on a number of things for example do you get access to capital so we'll talk about capital very soon how large is your market do you have a market of 350 million Americans as the US market is do you have a market of less than 10 million like Bulgaria or Denmark or do you have the 500 million European market that we think we have but actually in most sectors we don't so I'll discuss this in a moment I'll quickly go from my favorite topic which is however not the main topic of this presentation to note that so if you don't have much many people producing as a result you don't have much production much ability to to tax essentially so the state has to do more or at least many states many governments things that then this is a natural cure for them to come in and do a lot so what this shows is that this basically says how much the government spends out of the overall expenditure in any one year this is 2014 per country so how large is the government in providing services this is health, education, security infrastructure all kinds of services here unlike many of the pictures that I showed you it's not necessarily that low means good or high means good this is just to understand how European economies or actually societies not just European economies operate this number I've not put it on this picture for the United States is around 35% 34.6% so it's about 10% points less than the average for the EU so on average the US government not just the central US government but also the regional governments collectively are responsible for about a third of total expenditure in the United States in the European Union you can see that there are several countries including Denmark that basically more than half of overall expenditures are basically done I guess on behalf of the citizens by the government and later on and I'm threatened in the discussion we'll get to this point is this a good thing if the government is more than half basically a full expenditure is it not such a good thing I'll just in passing mention that Eastern Europe on this chart is where public expenditure is lower partly because coming out of communist years basically there was a natural tendency to have more so to speak right wing policies to reduce the role of the government so you see countries like Romania, Latvia my own country, Bulgaria that are below 40% public expenditure to GDP I should also note in passing that if you go even 25 years back in Europe's history you would see that everybody is actually spending a lot less so public expenditure was significantly lower 25-30 years ago and then gradually crept up year after year it crept up why is this important because this is linked in many countries probably also in Denmark but it's certainly part of the current Brexit debate in the UK that one of the reasons why we don't want to be part of Europe or the European Union is because Brussels imposes a lot of regulations on us that cost a lot of money and therefore we end up spending a lot of money to to basically deal with regulations from Europe this is actually not quite true in fact it's very little true while it's true that Brussels imposes many silly regulations historically if you see when European government started spending more and more in essence it precedes the enlargement of the European Union and various silly regulations that were imposed was decided basically to spend more and rely more on governments but by now I think if you haven't been depressed coming to this lecture by now you should be quite depressed because it all looks terrible so I'll quickly point out some good things about Europe so you don't think that it's all bad despite everything that we've mentioned and despite many issues that everyone of the European Union countries has generally most economists and social scientists agree that one of the perhaps the main precondition of of having economic growth and successful economies having a rule of law basically if I'm a private entrepreneur private firm and some other private firm is doing something that basically is damaging me I could go to the regulator of the courts and argue my case and if it's a just case succeed or if I have an argument vis-a-vis the government and the government is doing something bad which most governments tend to do then then I can go again to the courts or to the independent regulator and argue that this wrong should be righted so the rule of law it comes in various guises mostly people think of the judicial system but it's not just the judicial system it's also the regulatory system is the number one precondition for successful economic growth so if we look on that actually most of the EU except for my own country in Greece look quite good and I should say here that previous Bulgarian governments are responsible for the state of the Bulgarian but it's not our government but you see that on this indicator this is between 0 and 10 it verges between 0 and 10 when if you are let's say in let's pick a country Tajikistan basically you are zero so you know there is no rule of law the president decides everything and in fact I think last week the Tajik president decided that he would be a president for life and it was very easy everybody agreed they didn't need a referendum just government degree government for life so that would be a zero and you go to as high Finland actually which is highest in the European Union is also highest in the world at nearly a nine but you generally see that a fairly large number of European countries about a third of the European Union performs quite well here I've shown relative to the US but it performs particularly well if you compare to China, Korea and so on so actually we are very significantly above even industrialized world in terms of the rule of law and again mostly northern northern Europe but also some of the former East European countries like Poland which is good news if you get a few other things right it basically means that you have a good fundamental for growth in some of Europe others have to catch up and on that particular indicator enough European countries even ahead of our main competitors so we can hope to achieve better things if we try more well, why haven't we then so we have a good rule of law I've showed you some of the other reasons for why we haven't but I'm coming back to this topic of university education innovation also linked to the innovative companies so this is again sort of a public finance view just asking the question of each country how much of its GDP every year it spends on research and development most of this happens in the business community but a lot of it happens also in universities like this university this is not necessarily a pure measure of innovation because some countries can spend a lot and it can be totally ineffective but generally more expenditure on research and development goes well with subsequent innovation so we notice here that the United States which I already mentioned actually has a lot smaller share of government overall so this is not really organized by the government or at least not much of it spends about 2.8, nearly 3 percentage points of GDP on research and development we have a few European countries which is again good news including Denmark very prominently Sweden and Finland that spend 3 percent or more which is very good news then we have fortunately not Bulgaria this time Romania which spends basically nothing on research and development and in general with the exception of Belgium the rest is mostly southern Europe and a bit of eastern Europe and very little on research and development the result of that is that exports that come out of this region of the southern and east European region basically are not R&D intensive in fact during I mentioned it was mentioned that during the Eurozone crisis I was finance minister so I spent many sleepless nights in Brussels arguing with other finance ministers where the Greece belongs to the European Union doesn't belong to the European Union and the Eurozone and at some point we decided to look at basic trade statistics to see if public finances in Greece get better basically how the economy could grow incidentally even today the Greek economy hasn't grown over the last few years but basically what does what does Greece export what are its main competitive products in small audience I'll just ask a few people but I think you'll be embarrassing to ask in such a large audience and basically the answer is nothing so Greece exports nothing so it has in terms of its official statistics it exports what's called maritime services shipping but basically the reason that it export shipping is that in the Greek constitution until very recently it was written that shipping companies are not charged any taxes zero so you don't pay any taxes if you are a shipper in Greece and that you can imagine came from how to put it politely I wouldn't call it corruption just a lot of successful lobbying on the part of the sector at a certain stage in in Greece's development but basically about 25 to 30% until recently of Greece's export statistics were shipping which wasn't some of it is actually Greek but most of it wasn't Greek it just registered in in Greece and then another about 30% is related to olives so it's either olive oil or pressed olive oil or hot pressed olive oil or olives or essentially olive derivatives so really check the statistics another 30% is related just to olives and then there is another about 30 to 40% that is mostly other agriculture not only the agricultural products so there is some wine which is not great if you have tried it but somebody must be drinking it and there is whozu which is better to drink and so on but basically it's agriculture so if you are reasonable economist even undergraduate level economist and you've gone through your first two years of economics and you ask the question a country like Greece looking at the exports how can it grow basically you don't have a good answer can't really something else has to happen but then for it to happen you either need research and development you need more people in universities more people in secondary schools and so on anyhow a diversion we get to the main point that we with the very few exceptions in basically the Nordic countries plus Germany and Austria we don't really spend that much on research and development my favorite picture it was I think mentioned in the introduction that when I was at the World Bank I started this actually academic initiative that ended up as a policy initiative called doing business where we asked a very simple well several related very simple questions if some of you are not familiar yet with the doing business report it's one of the most exciting publications in the world you definitely should be should look at it but it basically asks many both academics and many politicians when they have nothing better to say about business they say it should be much easier to start a new business so we are going to make it easier to start a new business so in this project that we started about 12-15 years ago by now we said well let's take the same type of company around the world and let's ask three questions if you want to start it how long would it take you how much it would cost you and how many different procedures basically how many different agencies you would have to go to so very simple questions we looked at what the laws and regulations would provide for that so that's one of the sub indices which is called the ease of starting a business and similarly we have several other type of indices if you're a business you deal with for example an index on paying taxes which asks the question if you're a small business and you want to pay your taxes how difficult is it how often do you have to pay taxes can you pay them electronically or not how many hours does it involve senior management or you if you're the entrepreneur to pay these taxes and basically what are the legal procedures and we go how do you get a business license how do you enforce a contract in the courts and so on so ten or eleven different topics to get to this index of how easy or not it is to start a business this is basically the regulation what the state provides is to operate relatively easily or not so easily and it covers essentially every country in the world the index has by now 189 countries around the world and every year we rank them 1, 2, 180, 89 and then we ask the question who is best, who is worst but also who is improving so if you look from year to year you see who is moving up who is moving down so looking across the European Union we notice that the host Denmark in particular is actually best in Europe on ease of doing business now if you are in your country and if I am presenting this to businesses and I have presented this literally hundreds time to businesses nobody would agree that their country is better in anything so they would say no our government is extremely inefficient is very slow, taxes are very high which is probably true and generally it is difficult to run a business but this is comparing across different countries in the world on a number of indicators and it basically says all things considered actually Denmark is number three in the world the numbers signify out of 189 where you stand number one is Singapore number two is I think New Zealand for 2015 so Asia performs quite well on these indicators but beyond that you actually see which is I think good news that a number of the European countries not only Denmark do quite well incidentally this is a chart that is very favored in Brussels when we discussed issues of Brexit or Greece leaving or anybody else wanted to leave or do something crazy with the European Union because it shows why countries like Denmark and like the United Kingdom should stay in the European Union in my mind which is to improve the doing business rating of all the other countries in the European Union but also more seriously to improve overall the way that doing that business operates in the European Union why because often when we do analysis of the European Union and how it can grow better and prosper we do these comparisons that I started with while the United States is better in this better in that, Asia is better in this better in that and then you come to this point while they are different but there is a reason for that so somehow they are different than us institutionally, culturally infrastructure wise they are different so it may be difficult for us to do the same that what the US does but it is very difficult for somebody to argue when you put a picture like this and says Denmark, you know nice country but not too different from some of the other countries in Eastern Europe why is it significantly better in ease of doing business when let's say the Netherlands similar northern European countries people like bicycling so its culture must be quite similar but yet there are significant differences between Luxembourg even Luxembourg people don't like to bike much but there are the similarities or let's find if they are similar they should be able to be able to implement similar regulation so let's actually implement this better but not get Belgian regulation to Denmark but get Danish regulation to Belgium and British regulation to I wouldn't say Italy but other countries in the European Union so if you have the top countries being frustrated and basically saying okay enough with Europe you know it's too painful and we don't want to be part of it what's going to happen with the rest of Europe well it's going to be worse because there isn't this pool of the top performers if you like to say the whole of the European Union has to be like us so we need to improve and maybe even better than even better than us but still the positive view from this picture is that still all of Europe even Greece is actually in the first half of the global picture on ease of doing business so there are many countries behind us that still haven't figured out how businesses should operate relatively easily I imagine one of the favorite topics to discuss in Denmark is taxes so I'll show you just two different pictures of taxes but first to note that in terms of at least corporate tax policy Europe is actually better than the United States and I think most businesses who worked in both continents would tell you that while the US is better in many dimensions tax policy is quite quite painful in the US of course larger US corporations hide taxes mostly by coming to Europe and hiding it here in other parts of the world but you would see that both the level of taxation generally speaking and also the direction of taxation has been beneficial to Europe actually yes Denmark is there as well so in particular you see that in the last roughly 25 years corporate taxes have been falling in some countries like in Ireland you see a tremendous tremendous fall over the last 25 years this picture should have had Bulgaria which has actually the lowest corporate income taxes of any European country at 10% in fact if we have managed to be good at something in government in Bulgaria it's tax policy so we have what's called a flat tax I recommend it to Denmark so we have 10% personal income tax 10% corporate income tax basically everything is 10% so regardless of which tax you're looking at it's 10% and we have nothing above it so regardless of what you produce it's 10% it's easy to it's easy to remember and incidentally when we had in 2010, 11, 12 all of these discussions on taxation in the European Union the Germans in particular and the French were always very excited to say we should have uniform taxation so that nobody cheats on taxes as if nobody in France cheats on taxes and then I would say that's a great idea let's have Bulgarian taxation it's easy 10% non finance people can understand it and sort of that always killed the discussion that you know it has to be uniform but at the French level not at the Bulgarian level but on taxes while businesses can complain and I'm sure that in Denmark businesses do complain of high taxation not that relatively speaking actually taxes corporate taxes in Europe have both been falling and historically actually are not as high as they have been on average the exceptions in the United States this would be even more surprising to you and it goes towards the end of my presentation of say well what Europe has is that corporate income taxes are I wouldn't say low but at least falling personal income taxes are very high as they are in Denmark but not in Bulgaria and not in many of the East European countries but on top of the personal income taxes this is basically what individual pays when they when they get their income labor taxes which is essentially what you pay for social security and also for pension contributions if your pension system is mostly publicly funded also very high now why am I focusing on labor taxes and not on personal income taxes well because a lot of economic academic research over the last decade has been trying to find this answer why so many able people able bodied working age people are not working so what prevents them from entering the labor force and there are different explanations but one preponderance explanation is basically this that if you have very high social security taxes which are levit I should say on your wage so you come as a first time worker so you finished university or high school you join the labor force you don't have a very high wage at least most of the cases on top of that wage you immediately levit this additional labor tax essentially so that in the future you can be covered for healthcare for pension and so on so in a way it creates this disincentive for employers for businesses to hire people who are less experienced because regardless of how experience or not experience you are you still have this essentially add on your wages on your wage bill to pay so there is a lot of fairly convincing academic research to say that the higher the labor tax the less the new generation the just educated generation of young workers employees join the labor force they basically say well you know if I join I'll have to pay a lot of social security taxes plus it's difficult for me to be employed because employers don't want me they want somebody who is already experienced 5-10 years and has essentially the capacity to understand better the work process I put this graph here mostly as good news to Denmark within the general bad news on tax policy to say that a few years back Denmark actually significantly reduced social security taxation essentially following this very logical economic argument that unfortunately few politicians follow in any country in the world which is to say if you reduce social security taxes directly levit on wages chances are your labor participation your employment rate will go up and actually if you look in Denmark not just in Denmark some other countries have done this as well before and after the reduction in labor taxes you would see that the employment rate actually goes up very very very convincingly very soon after this is done but this picture is more for countries like France and Belgium and Germany even in this case and Greece of saying you know one thing that you need to do is somehow reconfigure your tax policy don't have this type of direct taxation on labor and shift it somewhere else where else I think we'll discuss we'll discuss in a bit this is just a picture from the doing business the earlier argument that I meant but specifically to taxes that one thing is how much tax you pay and another thing is how painful is it for you to pay this this tax to note again that in the area of taxation excluding the Czech Republic, Portugal and Italy most of Europe is actually quite competitive with the United States so it's not the case that the United States here have figured it out and if you follow presidential debates in the United States I'm sure now you do because it's fun you notice that every presidential candidate says that they'll change the tax system and it has not been changed for about 60 years so they fail miserably to change to change the tax the tax system so now I'm getting to the final part of my presentation just three or four more slides of saying okay so we now hopefully have sort of an idea of what are some of the problems and how they compare to the rest of the world but also what are some areas that we can build on like the rule of law or the fact that regulation on business while it clearly has some differences across European countries still is by and large better than in the rest of the world so what are areas that we can build on and these I'm going to just pick some areas to hopefully inside discussion after all these are by no means all the areas well one topic is digital trade so this is an area where Europe actually has some comparative advantage in the sense that we have high internet penetration much higher than in the rest of the world even in southern and eastern Europe in fact Bulgaria my own country is among the top ten countries in the world in internet penetration as are two or three of the other east European countries all the Nordic countries around you and I think Austria so out of the top ten eight actually are European countries among the top ten in internet penetration in the world eight are European countries so that's great but then if you look at at some basic measures like online banking usage it's increasing over time but it's actually not great well in Bulgaria it's not great at all but even in countries like Bulgaria or the average of the European Union is not so great why is that the case well there are several reasons I'm simplifying but one reason is that while Europe is supposed to have a single market single economic market so we should be able to trade everything seamlessly without any trouble in the European Union in the area of digital trade actually there is no single market there are 28 very distinct markets so if you attempt to either do online banking from Bulgaria let's say to Denmark and transfer money or do some other types of payment transactions and so on or in most European countries if you try to buy something over the internet and receive it chances are you're not going to be able to succeed or if you succeed it's going to cost you a lot why is that the case well we can discuss hopefully but basically the answer is that there are several of the large European countries like France for example that are very protective of their market and basically say that or have said until recently that they don't really want single digital market because it's somehow in dangers cultural identity of countries and people and so on so as a result one of the key markets that has propelled countries like the United States over the last 10-15 years or Korea over the last 10 years in terms of economic growth does not exist in Europe and there are some studies done both at universities and at European Commission that says that if we could just have a single digital market so basically it operates as one European market not 28 markets with different regulations and tariff policies and so on the European Union will add to its GDP about one trillion euro a year one trillion euro a year but that's something that is missing so I'll finish with just a few thoughts this is fairly large a large piece of work so I don't pretend to be exhaustive but from this slides and another about 200 pictures figures that we've worked on for this book project what are some of the things that come up so I've already mentioned most of them I mentioned the second one digital trade services trade do I think as former and to some extent current policy maker that's going to happen soon no, there is no interest maybe there is interest but there is no drivers, policy drivers currently in the European Union to actually make digital trade open there are some small initiatives but we are not about to see that happening I mentioned education, typically Europeans pride, we pride ourselves on having good education in some parts of Europe like here you do but it turns out in other parts of Europe education is actually quite bad bad by European standards and bad by world standards mostly Southern Europe some of Central and Eastern Europe but clearly a lot has to be done on just providing basic education and then good university services without that it's kind of difficult to see how a high tech sector can actually develop if you don't have the skills and the type of people who you need for that to to develop a third point we haven't much discussed today but it was very prevalent as a discussion point a year or two ago in the Russian Ukrainian when there was issues between Russia and Ukraine it comes every two or three years to buy to Europe is that just like in digital trade we are not a single market even though we are supposed to be similarly in energy we are not a single market either so every country basically does its own deals with Russia, with Qatar with whoever else in terms of providing its own energy it has its own regulators it has its own energy policy and there have been many attempts to change this including in the last few years when I was also part of European policy making and they have all failed and my prediction is that they will continue to fail up to a point when some of the large countries particularly Germany, France and Italy to some extent in Europe understand that it's also in their own interest so every time that there is a discussion of single energy policy in the European Union everybody says yes applause and then the large countries quietly go away and do their own deals because they think that they can get better deals that way not part of the European Union and as a result Europe is very little diversified in terms of sources of sources of energy we've touched a bit on the public expenditure I think I'll leave it for perhaps the panel discussion but mention that a very significant part of cutting public expenditures and basically reducing them to a point where there is less need for taxation so reduce taxation as well with that is the lack of pension reform and it's linked to this topic that we started with that the European population is getting older and older so we are aging as a continent very few exceptions unlike both the US where actually the population is getting younger and Asia where the population is still getting younger for another 10-20 years in our continent we are annually losing about 2 million workers or rather working age population every year so in a decade we lose about 20-25 million working age population here I intentionally do not discuss yet the topic of refugees and migration I think we'll leave it for the panel as well but Europe is fairly rapidly aging and as a result the cost of pensions and healthcare as well rapidly getting higher and higher so unless you somehow recreate the public expenditure system so you can accommodate for that which is a trend we cannot really do much about it in the next decade or so taxes will have to be increased and we'll have to be increased in every country and I also mentioned taxes on labour there is a bigger discussion on tax reform but I think that's not a discussion at the European Union level that's a discussion at the country level still and I hope for some time to come but a commonality across all European countries is that labour well except for Denmark is that labour taxes tend to be quite high and that's directly related to few people getting into the labour market and with that I would finish here and hope that somebody else can explain this slide for you and then we'll come back in the questions and answers and the panel discussion thank you very much for your attention thank you very much for the insightful thoughts the interesting graphs and the thought provoking facts that you offered us next we would like to share with you a very special and very interesting initiative that is actually run by one of our corporate partners of the finance and consulting club in Orhus namely McKinsey & Company and that is the McKinsey Global Institute Essay Prize if you take a very close look you'll see that in fact the topic absolutely coincides with our discussion today hence we would like to encourage all of the active students and not only to take active part and collect all our intelligence to try and solve some of the most pressing challenges in front of Europe the deadline is still quite far away 31st of July and the price pool is rather impressive so I think there is a very very strong call for people, students not only in Europe but the entire world to share their ideas how can we make Europe a better place both to live and work and as you can see you can find more information at McKinsey.com.com With that being said now let me cover the next part that is going to take part in this event and that is namely the panel discussion but before that we are going to have a 15 minute break and I would like to use the opportunity to briefly present the panel moderator so we are very fortunate today to have in our panel Birke Müller who is an executive director at Tink Tank Europa he has a very big experience in covering European type of issues and as well he has been a leading Danish journalist formerly also a chief editor of Mande Mont he also holds an executive leadership degree from Columbia University the Graduate School of Journalism With that being said we would like to also pinpoint that during the Q&A session for the panel debate you have the unique opportunity to actually influence the debate share your contributions and ask the most challenging questions you will be using the platform Slido on which you can use the hashtag EGC 2016 you do not need any registration you simply need to open your mobile phone enter that website and this code and you have access to the discussion and we will be able to actually our moderator will be able to pick what you ask you will be introduced shortly to the platform after the break so now please enjoy a 15 minutes break and as well the drinks and the food in the Upper East Building let's meet back in 15 minutes thank you very much ok ok ok ok ok ok ok ok ok ok ok ok ok ok ok Så Philip, hvordan vil den europæiske marked være effektivt, hvis Britten leave EU, hvis vi har denne brexit, som det hedder? Det skal være en tilfælde, for to rejser. Jeg tror, det er bedre for EUK at sætte denne kommende marked. Men det er virkelig skæreende, at det kan lede til disintegration af det hele europæiske koncept, og næste, som Danmark, smalere lande, som Danmark og Bulgaria, er faktisk virkelig bedre på en single, velfunktionerende marked, og hvis det disintegrerer, er det en tilfælde for business across Europe. Hvorfor kan de ikke se det? Hvorfor tror de, at brexit er det rigtige ting for dem? Jeg tror, det er en stor missmelding, og brexit-debatet er virkelig, at EUK, som ekonomier, understår, at det betyder, at det er en del af den grønne marked, men de er også offentligere og skære af, at deres andre, som migrationer, som taxivationer, og andre problemer, som føler, at det kan være vigtigt, at rejse kontrol af certaine politiske områder, men selvfølgelig, at det, som du overleder i de britiske debater, er at der er en høj pris for at kende. Det er fulgtigere grønne i UK, som vil skære, og vi kommer til at se en stor devaluation, og vi kommer til at se vigtige konsekvenser for ekonomien i UK. Hvordan tror du, at EUK og UK nu skal gøre det? Hvordan skal de gøre det? Hvorfor remainses det en hård film, siden votet er kastet? Hvis det er en støvvot, så er det stadig vigtigt for Europa, fordi det har omfattet idéer, at du kunne gøre det. I en støvvot vil vi se den store devaluation i UK. Vi vil se vigtige vigtige vigtige ekonomisk tomoet i Europa. I en lande som Danmark kan vi starte en debat, så skal vi også gøre det, fordi det er så vigtigt at bygge anti-europane argumenter, og det er så tænkt at sige korrekt ekonomiske og business case for integreret i Europa. En af de rejser, der vil gøre det, er, at de tror, at de kan også have en fri-trade agreement med USA, og nu er EU og USA også tænkt til at finde en fri-trade agreement, TTIP. Hvordan tror du, at det kommer til at bygge problemet? Hvisst tror jeg, at det er en vigtig vigtige vigtige vigtige, fordi hvis du tænker om det, det grønste challenge, du har ved integreringen i UK ekonomisk, er ikke fri-trade og gode, det er fri-trade og services. Og det er ikke vigtigt, at UK kan begynde at begynde at begynde et stort service fri-trade med Europa, men også med USA. Og den struktur af ekonomisk ekonomisk ekonomiske er meget servicevægt. Hvis du tænker om den finansieleksatør i London. Hvorfor vil anyone i Frankfurt komponere speciale regulaterer fra UK? Hvis du ville være en fri-trade finansieleksatør, så ville du gøre everything possible to avoid having the UK competition on that market. Så at remain or gain access on services just like financial services, it's impossible in Europe, it's going to be even more difficult vis-à-vis the US. En anden critique of the European Union from Britain is that they simply put too much regulation on the standards of products for instance, whereas in the US they have much lower standards. Så hvordan tror du, at Europa skal gå i regulaterende standarder for produkter i the EU? Jeg tror, at det går for i regulateret som en muttul regulat. Så hver USA-forskninger siger, at denne sted er en forholds-transportation i Europa, så skal vi sige det samme. I en del af det, er det denne muttul regulat, det er en air-traffik. I en hel del af en aeroplane, der er forventet i USA, er forventet automatisk forventet i Europa. Så hvis vi kan skrive på muttul regulat i air-traffik, så kan vi ikke skrive på muttul regulat på den måde, at sepelser er faste i stedet, i måden, at produkter skal være færdige eller, omvendt om, hvordan insuranser og finansielle systemet skal være integreret. Det større dilemma her er, at der er spørgsmål og færdigere spørgsmål. Det er meget svært, end at skrive terrorer. Tak, Philip. Og det var alle fra livestreamen her i break. Vi ser dig, når participantene kommer, og når vi har en paneldebat. Tak, fra her. Vi har en paneldebat i en kort tid. Jeg hedder Bjørn Kemolle. Jeg er direkter af en sinktank, som hedder Europa, i Copenhagen, en independent sinktank. Og jeg er meget glade for at være her, for dette debat, om Europa's growth challenge. Det er indenfor en stor fråga. Selvfølgelig synes du om growth. Du synes, vi er faktisk i en liv, i en tid. Det er meget prøvende tid, og vi er faktisk meget komfortet med vores liv. Men growth er virkelig en stor challenge for Europa. Der er en stor prøve, der kommer ud fra McKinsey. Hvordan kan vi søge det? Du kan participere i det. Vi har bare annoncet det formeligt. Men vi kan have ekonomiske hjælpe os ud. Jeg synes, vi vil præsentere panelen nu. Se mig, vil du være her? Og så har jeg Philipp Schrøder, professor af Business School, lige her. Og vi har Bo Sanderman Rasmussen, professor i Business School. Vi har Clemens Jartar og director af McKinsey & Partner at McKinsey & Company. Når vi har debater, vil vi have priser. Du kan engagere. Du kan have en slider forforskning. Der er to books online. To books by Simeon Jankov. Jeg synes, de er meget interessant. Det kan være meget interessant for dig nu. Og i eurokrisen. Jeg synes, det er en god mulighed for at tage denne konversation. Jeg starter med den første. Densmark er virkelig forforskende. Hvorfor har vi en growthkris i Densmark? Bo Sanderman, du er en formel af taxkommission. Du har været meget engagert i den makroekonomisk debat i Densmark. Kan du hjælpe os ud her? Jeg synes, det er en lang term growthproblem og en lang term growthproblem. Det er en lang term growthproblem. Jeg synes, det er kommet ud af krisen i Densmark. Det har været forforskende forforskninger og firmer. Det er vigtigt at tage mene. Hvis du skriver de ressourcer, så kan de forforske private konsumtion og investering. Men de vil ikke. Det har været forforskende for over 6-7 år nu. Det er en lang term problem, og det er vigtigt at tage mene. Hvorfor har det været forforskning i den næste 10-20-30 år i Densmark? Vi kan starte med at tage mene. Hvad er der forforskninger i Densmark? Vi har været forforskende forforskninger. Hvis vi vil have en growthkris i 2 % i år, så må vi have mere forforskninger, som kan forforske laborforskninger, eller som kan tage mene for forforskninger. Så de kapaciteter for growth kan forforske. Det er vigtigt at tage mene for forforskninger i Densmark. Vi har et stegnation af forforskninger i Densmark. Det er vigtigt at tage mene forforskninger i Densmark. Du var på forforskningskommission Filipe Schroeder. Hvorfor er det vigtigt at tage mene for forforskninger i Densmark? Det er vigtigt at tage mene for forforskninger i Densmark. Vi har et stegnation af forforskninger i Densmark, og det er vigtigt at tage mene for forforskninger i Densmark. Hvorfor har vi tænkt, at vi ikke har et stegnation af forforskninger i Densmark? Det er ikke alle markedene, som vi tager forforskninger, som vi tager forforskninger i Densmark. Så kompetitioner, forforskninger, forforskninger, internationaliseringer, ser ud til at tage mene for forforskninger. Og med at åbne op og med at løse produktiviteten i forforskninger til at begynde industridynamikken i Europa, vil vi se Zan, fjernes og grønne i Europa? Vi har en interessant ansvar her. Hvordan vil Europa tage for at improve teknologisk innovation? Jeg kan ikke se det her på min screen, men i hvert fald. Clemens, Jarth, du er også ind i digital teknologiske, og det er en af problemerne, som også er forforskende i presentationen fra Simeon. Og der er en meget stor forforskning i Europa og i Unia. Men kære til USA, vi er virkelig lagerter, ikke vi? Vi er lagerter i at bygge teknologisk forforskninger, forforskninger. I mange sektorer er vi faktisk på par, eller bedre at bruge teknologisk forforskning. Og jeg tror, at det er en af de kære forforskninger, som vi har forforskninger. Vi kan se det, fordi vi er i midt af det, men vi har faktisk været i en stor forforskning. Vi har en Telco i Danmark, som har 25.000 employee. Vi har 7.000 eller 8.000. Vi har banker, som har 1000.000 af franser. De har nu 100.000 eller even less. Vi er så brug for teknologisk forforskning i nogle sektorer, og når jeg ser en chart på online banking, og jeg ser nogle af de skandt navige pier, det er ikke bare om at bruge online banking, det er også at transformere sektorer, der er behind. Og så får man produktiviteten, som vi har forforskning. Det er faktisk i alle sektorer. Og det er også publicsektorer, som bliver digitaliseret. Simen, har du været begyndt at studere, om det er nødt for dig, at få et digitalt, singel marked, og hvordan det kan forforske performen? Ja, jeg har studeret det, først det overrørende, hvor Europa kan få produktivitet. Jeg har altså sagt, at singel digital marked er en relativt svært måde af, hvordan man kan få det der, siden man har et meget segmentet, både regulatøresystem, men også præsningssystem, og generelt segmentation af denne marked. Hvordan kan det gå frem? Det er relativt nye markeder, og reglagerne forforskninger, og ikke de senste år eller år, så kan man gøre dem relativt snart. Og det er ved denne periode, meget af denne regulatøresystemet af Europæiske Kommission. Man kan sige, at man er extremt sikker på at gøre det, og det har ikke været. Der var en stor pressrelig, men nu ser vi det, og vi er sikker på det, og du kan gøre pressrelig, men du kan ikke gøre noget. De er bare sikker. Så det er en lage leadership? Ja, i denne marked er det, og jeg ved fra min politisk erfaring i Europa, når denne issue var rødt, at du kan gøre et par lander, som vi kan gøre. Frans er altså always the leader of that, der siger, at vi ikke vil være alle sammen, vi ikke vil være en homogeniske marked, fordi vi gør vores identitet. Det er en vildt komment for at gøre det, men det har i hvert fald for mig, at det gør det i sådan en svært marked, integrelse og topikse, som digitalt marked. Og så har vi vores, at i nogle sættere, Europa er rigtig godt i at adoptere nye teknologer. Det er virkelig. Vi har også nogle sættere, hvor vi er meget godt i at generere nye teknologer, som i biomedicine, for eksempel. Vi er head af U.S. i mange ting, men også hvor vi genererer teknologer, og vi har gode company og business. Jeg er i fint med det. Bredt kan de ikke gøre det. Fyldig. Og de bliver sødt til amerikanske, eller chineske og så. Og du ser fem år efter, at de er stående. Det er faktisk en amerikanske company. Så at have 28 næste næste legislatøjer er en rigtig... ...sætter. Ja. Filipp. Just out of curiosity, jeg har en del af at være en ekonomisk erf-ræsør, så, Lisa, jeg kan sige en fråga, fordi det skriver mig, at det er en måde, du ser, og du vil spille til oss, at der er lemmer, at vi realiserer digital teknologiske udvalget. Og så kan et politisk system forløse det. Jeg mener, det er ikke om at gå ud, ikke? Automation, dekitarisation er omkring det, hvilket eller ikke i Europa. Så hvad er det mekanismer i din øje, som løber politiske, at se på den anden måde, og håber, det stopper. Bækert, fordi det er en af de reglige og først nødvendigere at være grønne på den næste niveau, og hvis du har to eller flere af de grønne spiller, som Fransk, som Italien, i dette particular sted, så nej, nej, det er ikke et omkring nu, lad os vælge, du er blodt. Så det kommission itself kan ikke gå farligt nok, til at blodt, altså nogle af det, til en krise kommer, og en krise kommer, fordi vi er laget hver år behind. Båd, Sanderman, siden af valgfærdigheden, siden af valgfærdigheden, det er en af de kønninger, som har faktisk også været, og siden af valgfærdigheden, er det løb af valgfærdigheden en abstekul for hver growth? Well, min opdeling i det lille sted er, at de lille steder er faktisk et politisk domning, og hvis du vil have en lille valgfærdighed, det kan betyde, at du ender med at have, selvfølgelig, en lille private sector, og det kan være mere produktivt end den publik sector, så overvalgfærdigheden kan være videre på det. Så det er sådan en sort af valgfærdigheden, og selvfølgelig er det politiske, som vil indgå, hvis valgfærdigheden synes givende. Og selvfølgelig, markedfærdigheden effekter valgfærdigheden, så valgfærdigheden er meget forskellige fra det, der var mange år senere, fordi globalisering, teknologisk og så på, og selvfølgelig, så politiske skal adbejde til virkeligheden af markeder, og for eksempel, i termen af taxation, selvfølgelig, der er mange problemer, today we know that, that it's easier to hide the money, where taxes are not being, or taxes are not being that high, and of course that will limit also the size of the public sector, and of course, that even just increases the cost of having a big public sector, and of course, then you would like the politicians to react to that. But can you find the right size, there's a question here, what should be the right level of government spending in order to have growth? Could you say anything of that? So there are a number of academic studies that look at the interaction between public expenditure, public financing, and various measures, mostly economic measures, like economic growth, productivity, and the magic number among middle income and rich countries, which is where Europe is, is basically between 40, 42, 43%. And so a lot less than Denmark, somewhat more than Bulgaria, but basically your government should be reducing expenditures. Central European, East European government should be increasing them somewhat. Of course, one can say, well, it's not all about productivity and growth. We want to, you know, live in a society that where we think the government is better at providing services. I don't think so, but many people seem to think so. And isn't it all about the quality of the spending, the efficient use of resources? Welfare spending doesn't say anything, would say Romania was very low on the schedule, the ranking you had. If you lower the average rate in Europe, it would 10% will be on the Romanian level. And that is not, you will not make certain that you will actually have efficient use of the productive use of resources. Clemens, do you think there is some kind of, you know, suggestions to politicians at how they could change and transform the spending, the public spending to help enhance productivity in the economy? In Caramelle? We have debated this a lot and we have done a lot of research on productivity in various sectors. So very much like a input kind of driven solution. And when you look at these numbers and you study the societies of like North and Europe, obviously there is a component that is on kind of the productivity of input. But to me, there is also a larger and larger share that should come from ambitious target setting and say, why don't we say that we are going to make it a goal for us here in Denmark to have a average length of life of 85 years, kind of five years plus. We will be able to achieve that in the next 15, 20 years.  It would give goals on education, it would give goals on technology, it would give goals on kind of some part of equality. So instead of just saying, I'm gonna make school teachers 10% more productive or I'm gonna adjust kind of things in the system, then say, we will actually put out some ambitious goals for us and drive very specific kind of reforms from that. That is the kind of methodology that I'm getting more and more appealed by. Yeah, for short comment. I wonder if it is quite important maybe to distinguish between public expenditure and public provided services. So you can probably have quite a sizable state, but the state buying that service on the marketplace. And that is a very different economy, very different dynamic to productivity than the state trying to do everything itself. So like the state doesn't create their own computers because they need computers in their works, they buy those. So the state can of course interact more with the marketplace in most European countries. And I think Sweden is a wonderful example of experimenting in a Scandinavian type model, experimenting with buying services on a marketplace. And that has impact on the efficiencies you get. Absolut. And also is about the productive investments if the public sector is actually doing or state doing investments. It should be productive investments. So what, how can the state know about productive investments? You know, it's obvious you have to invest in universities. Oh, yeah, yeah, service providers. This one, the top question up here. I must present you for the top question here. What is your opinion on secular stagnation? Is it something that can be fixed by structural reform and fiscal expansion or are we doomed to lower growth? Bo, that must be a question for you. Okay, well. And it's by Christian up here, yeah. Well, basically, if you look at the determinants of long term growth, that would be really productivity. And productivity is generally created by people getting good ideas that can be implemented to make production more efficient. So ideas are basically what generates long term growth. And of course, if the population in the industrial countries are getting smaller and smaller. And of course, there's a risk that we don't get more and more of these ideas that will lead to higher productivity. Look at the kind of the post World War II period. Of course, we had huge expansion of populations in Europe and the US. That created growth as well. So there is a problem with stagnating populations, because that could be what was generating the growth for the long haul. So there is certainly an issue there. Of course, you could argue that you could have last year the population going into research and development. And then in the very long run, of course, there is an upper limit. But still for a very long time, we could probably still do that. But what are the most effective structural reforms that actually should be done right now in Europe? Just give me some examples, Simeon. I was actually going to say that the idea of a country, a small market, or even a large market in Europe, having its own idea of how to run the state and having a welfare state more than other countries, actually cannot exist within a truly open market. Because what happens then, more than people from Romania and Bulgaria, say, well, other than the weather, you know, I really like Denmark, so I'm going there because, you know, they're going to provide me with more opportunities. And then people who come from outside of Europe, as we have, I saw one of the questions here on migration and refugees, also come to Europe and then say, well, where should I go? Should I go to Bulgaria? Not very well-paid, but nice weather. Should I go to Denmark? Ja, the question is actually a question. Is refugee crisis a solution to low-population economical growth in Europe? That's the question. Is it? In my view, it is, although this is a very hotly disputed view, so if I was a politician at the moment, I would probably not say it. But I'm listening to politicians and saying it's trouble, it's trouble coming and it's a high cost for the state, you know, welfare benefits, et cetera, et cetera. Look, we just, the previous discussion made this point that if you look at long-term productivity growth, it's basically more and newer people coming into high-productive industries. Well, we don't have many people in Europe now. You can have some movement from Eastern Europe to Western and Northern Europe, and that's happening. But if you suddenly have an infusion of a couple of million people a year from outside of the Union to Europe, suddenly that can create the type of labor mobility that Europe lacks. It's not going to be immediate, however, because just the number of people is not enough. They have to be trained. They need to know the languages. They need to operate within an environment that is productive, and that takes some years. Boom. Ja, of course. Sorry. Being an economist, I would agree on that, but of course we also have to consider the political issues here. And just taking Denmark here, well, it would be easy to find the majority against further immigration in Denmark for other reasons, because probably you think they are too difficult to integrate in the Danish labor market and the Danish economy. So there is a potential, of course, but it's not easy to actually to read that potential. And I'm quite sure in many European countries today there's kind of an animosity against the immigration flows that we're seeing at the moment. So it is a tricky question, and there is a potential, but I'm not optimistic. When on labor market reforms you can't really, it's difficult to integrate. We have a closer sight in some way in cultural terms as well. We recognize the Danish debate. If you talk about labor market reforms, you would even see some politicians backing off. Well, now we are hurting our domestic, our ethnic Danes, to integrate these refugees. And well, certainly someone would be against it. So there are political issues there that are important. Fido. I think to add to that, basically to full circle to questions, sort of what are the most effective structural reforms. I think what economists often ignores the timing of when these reforms actually work, or when they, as their impact comes. So if you take, for example, Simeon's proposal about the digital market integration, that impact will be extremely swift, a US-European free trade agreement that has an extremely quick impact on creating productivity and growth. Now investing in human capital, it's going to take 25 years before you see the impact. So, and that's in a tax bookish world, we don't worry that much about it, but I think in a political world that matters. And here migrants in some sense can be a quick fix, given that it is a right human capital composition. And that I think is an open question. I have no idea if the migrant flows we can attract in Europe have the right human capital characteristics or not. There are also studies, economic studies done on this, and actually the phenomena is, when they are coming in the bottom of the market, actually the local salary is also rising for domestic. Okay? So I think what we need to think about is that our world is going to change quite significantly the next 15 years. So from a technological point of view, it's going to change much more the next 15 years than it did the last 15 years. And in the last 15 years, we had the internet, we had mobile phones, we found the genome or kind of coded it, decoded it. So the change we will see is going to be quite... Robotics, automation, sensors. It's going to be quiet stackering across all sectors, which means that we'll have relatively fast impact on the labor composition that we need. So if you look at the sectors that we have in, if you just take it at Danish perspective, right? And we have like the least productive sectors. We prefer European perspective here. Yeah, but you can also take the European perspective and say kind of take agriculture, right? Kind of low productivity, massive kind of reduced labor force. We have kind of the big middle service sectors. And then we have the high value ads, kind of pharma, machining, kind of things like that. And that composition, we know that we will have an enormous labor escape from transportation in 15 years time. I mean, it's not really a question. We know that's going to happen. And we also know that the retail landscape is going to change quite significantly. So if you can kind of think those pictures out a little bit, and then benchmark our productivity against that picture, I think it's going to give us a lot of the answer. I think McKinsey have done many interesting studies on the resource revolution or the resource economy, whatever. And actually, we've talked a lot about labor productivity, but also resource efficiencies coming in. And also as part of the question of digital single market could also be effective in that sense in able to enhance an energy union being effective, that people have knowledge about the consumption there, actually at the home or at the laborer place or workplace or it could be a transportation, whatever. So information, digitalisation and resource efficiency is coming together in some way. But how can Europe do something that really matters in that field? Well, I think that comes back to what we said before, target setting. So I think actually energy and the renewable energy revolution is actually a good example of something that could become quite successful. So we completely changed the energy composition of Europe before all the markets and we are thus changing the energy markets and kind of resources, kind of efficiency of the world. So setting targets for the energy sector, setting targets for digital trade in Europe and setting targets for health, if we are able to do that and agree on that kind of target and also have targets that the voters actually would like to have. Let's not kid ourselves and kind of put austerity targets that the voters don't want to have. Let's put out some attractive targets for everybody and derive things from there. So we take painful targets in Europe. No, but it needs to have meaningful targets. That's interesting point. I like this idea, they have to be, I think, very narrow, for example the 85 years life expectancy and then you work around it, because otherwise if we just say we want to be, remember we had the Lisbon Agenda 2000 by 2010, Europe will be more competitive than the US. Exactly the opposite happened. So we went down, the US went up. And then European politicians said, sorry, we missed it. So we need to have a narrow targets and then I agree with you, then we actually have a chance. I think what we haven't, perhaps this is outside of our realm, but I should just mention it, is that when we discuss Europe, you get to the point of who is Europe. So who are the decision makers in Europe? And you get to the point that actually, while at the national level we have governments and ultimately the prime minister or the head of state decides on things, in Europe it's not even clear who decides. The European institutions are still, let's put it politely, so still developing and evolving, but if you ask the question who decides, let's say on single capital markets, on single energy policy, it's not obvious. We have, that's why we have the five presidents report, you know, there was this recent report, European report on the future of the union, five presidents, European institutions, presidents wrote it, so that gives you an idea, nobody is deciding basically. No, they did not make a difference really. No, five people sort of met, signed something, I'm sure somebody else wrote it and then there is no decision maker. During the Eurozone crisis, you remember this famous phrase by Tim Geithner, the finance minister of the US, who asked when I had to ask a question or decide something on Greece, I don't know who to call. You have a quote in your new book coming out, you know, Europe is afraid of strategic thinking, too many tactical and incremental proposals are coming out, also from think tanks as well.  What can we actually do in order to get out of this leadership crisis? Wonderful example of recent years is how Germany changed its entire energy policy and what it took was not meetings, it was not a discursive one of the think tank, it was an earthquake in Japan. And suddenly that entire nation could do 140 degrees turn around. So wonderful crisis then, okay. And I think in a sense, you said in your talk, sort of you basically the bad decision maker that might be going on is, what it needs, it needs a deeper crisis. And it's a shame that one sort of open wide-eyed is heading into a worse spot before it becomes better. But it appears to me that we have crisis all the time. So why don't we react very slowly towards finding a new solution. When you saw it in the charts, we have so much litter, we have a good time in Europe anyway, and we don't work, so why worry? So often Europe probably needs a women crisis. If you look at the labor participation, I mean you start late, you go kind of early on pension, and half of the labor force has a much, much lower participation. So if you get a fantastic women crisis in south of Europe, we could maybe get the participation up. One of the key ingredients is going to be participation of women. It would not be migration of women from southern Europe. I'm open to all kinds of solutions. All kinds of solutions. I'm married to Spain, so in fact, important university. Bo, there is a question up here. More growth might come with the cost. Is more inequality the price we have to pay? What do you think about that question? Well, there is no simple relationship between growth and inequality. It can actually go both ways, I would say. So of course you can make reforms that will lead to more growth, and at the same time it will hurt equality, but you can also do the opposite. So it really depends on the type of reforms you're making. So before we know specifically which type of reforms are actually going to be pushed through, we don't know if we'll get more inequality. But of course, as the markets are, I think there is a kind of a secular movement towards more inequality, driven by globalization. Does that need to be a problem with higher growth that could actually, you know, everybody could benefit? Ja, sure, sure. So it's more that if you, some view that there is a problem of inequality and that sometimes it can lead to kind of social unrest and so on, but I guess there's not really strong evidence on that. But to some extent you can see as long as you get everyone kind of benefit from it, there's probably no problem. We also seen that in the US where the bottom of the income distribution has more or less had no increase in their real wages since the early 90s or so. Well of course the top incomes have kind of been running away. So it depends on how much this kind of trickle down will actually occur. And of course if there is some trickle down, I think there's probably no problem in that. But looking at the historical perspective, we've seen central european and eastern european countries coming into the single market, you know, being part of this, having a high, you know, actually we saw a high growth scenario in those countries being included in the market. So actually looking at the historical perspective we've seen less inequality in Europe, but maybe there are more inequality inside nation states. The different perspectives I think it's important. So since I spent about half of my time in the US and followed this inequality debate, not only as an economist but also as a participator in the public debate there, it's interesting and also how it's very different from Europe. So inequality in the United States, just statistically in the United States and the United Kingdom, is in fact increasing over the last 15 years. That's not the case in continental Europe, so just statistically. There is an increase in inequality, but it's very focused on the US, on the UK, Australia, actually anglo-saxon countries, interestingly have this trend. In the US lately this has become the main topic, both presidentially and otherwise. And what one finds, which has relevance for Europe as well, is that it used to be that if you get better education, you essentially are not in danger falling into sort of an inequality trap. You're going up no longer. In the last 10 years even well educated people in the US with university education tend to actually, in particular regions of the country, tend to become relatively poor. And this is a question, why don't they move? Because the US is one market, they should just move to better areas, they do not. Going to Europe, this is why I don't like at all this idea of let's now segment again Europe either because of refugees or because of others. This was going to happen in Europe. The little mobility that we have now, if we segment again in some ways, we're going to have pockets of poverty, even in countries like Denmark, even in countries like Germany, we see this happening in the US. There's no interesting question here, there's also connection to this conversation here about inequality and also about how to benchmark 1.7 and what kind of perspective do we need to have. And it's yet questioning why benchmark us with US, the middle class in US has not experienced the better purchasing power the last decades. Do we want the Trump effect, blah, blah, blah, but what do we measure? And I think it's a crucial thing, what about the middle classes? This enchanted middle classes in Europe are frustrated and we also see some amount of frustration in the United States. What can we do about that challenge? That's a big question, I was looking at this TV program earlier this week showing two neighborhoods in Olbo with the difference of life expectancy of 16 years kind of within the same city. So kind of this pocket of inequality and poverty in our societies that is quite staggering. And I think kind of we will have to agree as a society where we want to go. Is that the road that we want to go down and kind of in 10 years that difference is going to be 25 years? Because that will have other consequences for society. So I actually don't have any kind of really good solutions for that. The big question is actually we had this idea of progress that actually our kids would come out better than ourselves. And this is there is some certain amount of crisis here because of many people feel that the kids are not coming out better than they and the lives getting more complicated. But they probably feel that way because it might be that way. And I think it is absolutely, I think kind of this is a matter of transparency, education and granular measures to try to stem against this. Just to add to that, it's not only that they thought their kids would be better off in there. They also knew the way that their kids would be better off in there, which was through education. And now what's happening is not to alarm the students among you, that even with better education you're actually not guaranteed to be better than your parents. And that's vejd by now prevalent in the U.S. And it seems in statistics to be actually starting to see it in Europe as well. And education doesn't buy you any more the ticket to prosperous life. I wouldn't believe I would say this, but there are serious economies that start to wonder if you are measuring progress correctly, right? You know all of you know this. Quality, how should we adjust for quality? The sort of health service I can get today is much better than 10-20 years ago. Even so income wise I might still be stuck in the lowest end. I think the big issue between 10 years ago what we have argued in the U.S. What is the difference in the U.S. Is that those that are high productive individuals can afford to buy the services from the low productive individuals. Well in Europe we have installed our society so that we cannot afford to buy the services of the lower productivity individuals and force them to be out of employment or whatever it is. I think that's where the structural difference that could be tackled in Europe eventually. Bo, do you want to have a comment on this? No. I think I'll open up for some questions from the floor actually because there's one conversation going on here and someone is calling the phone. So please raise your hands. We have some mics going around here I think. Please somebody wants to raise a question. We'll just continue. Oh there's a question down there. Okay good. Down there run. Raise your hands. Good and please tell us what's your name. We have yet to discuss climate policy within the European Union which is a topic which most of the European countries agree upon. Is this a potential area where when we all agree we can all work towards a larger goal as the guy, sorry the man from McKinsey argued. I forgot your name sorry. Clements. Clements yes but should we discuss climate policy as the target sort of this bottom line. Suddenly the Danish government is cutting subsidies towards what they call energy policy and how we know Parker sorry. Is this something where we should say climate policy. We all agree let's work towards this goal and then we say mold economy to fit this goal that we need to reach certain target or threshold. Okay please. I think that's I mean that is my opinion. I think that's a great idea. I think that is that is a goal that we have a majority of society that actually is worried about. We have scientists and a large majority of scientists that actually support the theory of kind of human cost kind of global warming. We have technology that can help us get these goals. We have a geography that means that we are a little bit low on oil. So there are many many aspects here that says this would be a really good meaningful goal for Europe that would help us to actually create economic and kind of labor transformation. So I kind of completely agree with that. Ja please. If I may add it gets again to the point of how decision making is made at the European Union level. So we gave the example of nuclear power in Germany. A great example but one government so Angela Merkel basically decides does it. It seems to now gain more popularity among Germans. In Europe we work on nearly every issue by consensus. So it's enough for one country to say we against it and at least two countries that I know that are against it. Poland because of coal and the Czech Republic because they generally like to be against whatever the rest suggest. Okay. Good. So we need a different decision making process as well. Other questions out there that all you are not timid here. Okay good. Please make it short. As I heard it increased economic integration within the Europe could be a solution to some of these challenges we face. But at the same time we see Austria, the pen in France, Cobra in the UK and generally in all European countries we have the far right or the far left who are against globalization. How should we challenge these perspectives. Okay. And someone might add something to that. I share that frustration. I think it has never been as easy to create an anti EU argument. And it's surprising and in particular countries have been the big winners of European integration. A country like Denmark. I think it's the 20 second richest country in the world for the state today. Without any significant natural resources no huge industrial basis. There's nothing special about the country number 22 in the world ranking. Oh it's a German speaking. It's a great university. So obviously what is driving there is the ability to integrate this economy with the global marketplace. And that is predominantly the European marketplace. And it's surprising me. I think maybe it's our fault as economists that we are not good enough at explaining why integration is useful for the economy. So more research then. Paul could you explain. Well I guess you could also argue that the way the EU handles its policy administration could be sharp and somewhat. And I guess if we could cut somewhat down on the red tape in the EU that could perhaps create a better environment for making you also a more active player in this. If I may on this one. The red tape story. So you make it sound as if in Denmark there's no rules whatsoever. I mean in Denmark the state saves my money so I have money to go on a holiday. I mean how much rule is that. Do you like that. No I say. And the red tape stories also is something about the single market. They actually cut a lot of red tape around Europe. Ja, but so the story goes all the European countries would be total anarchistic market free market economies and it's only because of Brussels regulation. I think the contrary is true. Every single European country has a bad track record of doing silly regulations and at Brussels at least tries to harmonize it somehow. What do you think though. Yeah, but there's still a lot of animosity in the various countries that they think there is a lot of waste going on. So if we're going to have a more greater desire for European Commission to play a role there. I think each individual country that the citizens there should be able to see that what is done there is actually meaningful. And not just seen as a waste of resources. Okay, what's the matter. I think it is worrying that you mentioned some countries for me. It's worrying that even some of the biggest beneficiaries of EU money like Poland, like Hungary, like Slovakia have turned smaller countries perhaps in the bigger picture. But you know they have turned very nationalistic. Austria as well actually in studies of across the EU who has gained so far the most from integration. It's actually Austria because all of Central and Eastern Europe opened at some point looked where to invest and how to do an Austria was right there sitting pretty. So it benefited a lot and to see Austria now turning against the European Union is quite striking but not that populism because it's populism. It's not just nationalism. It's pure populism comes because of two reasons. This rise of inequality or in general feeling that something is not quite working in Europe together with a fairly stale political system in a number of our countries. So Austria has been around. But finally they got a green unknown president. No, that's what I'm saying. But there were two parties there highly corrupt by world standards, not just by Austrian standards. And somebody actually managed to win over them. We should be happy about that because corruption in politics in Europe is maybe not in Denmark, in the rest of Europe is actually quite high and some change is useful. I have a last question here from the floor. Okay, somebody? Yeah, please just speak up. I'm still wondering. You have to shout loud, you know. I've already repeat it. No, so I was wondering about this. I think we'll just wait for the microphone. Nobody can hear you back. Please. No, I just wondered how I could get a job at one of these top universities. So I know it's going to be difficult. So you have this statistics with the US being predominantly in the picture. And the question is what can Europe do? Do you have a suggestion for what Europe could do to make its own ranking, I suppose? No, perhaps an even more productive solution. So I've worked in, as I've said, I've worked for a bit at Harvard. I now work at LSE. So I've seen some of these universities. What is the difference between them and most of continental Europe, I would say? There is a huge relative to most continental European universities. There is a huge focus on research. Very well paid. So it's not universities are thought mostly to be research places. And then you teach and then the students learn not just in class, but they learn basically by being part of this research environment. Most of continental Europe is you teach. And then if you on the side do some research, that's great, but it's not really the main thing. So focus a lot on research and internationalization. This is always a big part of just bringing new ideas. And Europe generally is lagging very significantly behind that. It's also competition. Well, it brings, that's right, new ideas competition. Exactly. You're right. One question here, last one. I noticed that not one single member of the panel has mentioned monetary policy or European central bank. Good. Then we'll have the question. Does that mean that you consider monetary policy or the Syrian interest rate policy or quantitative easing for absolutely useless in the context of economic growth? Okay. Simeon, you have the first one here. I have a contrarian view. Yes, I think it's absolutely useless and in Europe it was done late and it was done badly. And now that it's done badly and late as most European policies, we're doing it a lot more than we should. Before we turn the corner. So generally it's not the right answer to Europe's problems. And what about the Americans that did it fast? I think they did it fast. It was the same wrong policy, but they did it much faster and they finished quickly and declared victory. And then market somehow convinced, you know, these guys may know something that we don't know. So it must be right. Well, we waited and waited and it was obviously wrong. Well, maybe a bit egressive because I don't want to change my entire reading list for the auto macro class. So there is still a room for traditional macro economic policies like monetary policy or fiscal policy. But we have to understand what Simeon pinpoints is a trend growth. And that's very different from trying to navigate the economy through the business cycle. And I think the traditional macro policy tools have the justification also in 2016 in navigating the economy through the business cycle to some extent. And they might not be as effective as they used to be, but they still have some effect. But they don't solve long term growth problems. Bo, do you want to come in? ECB was kind of preoccupied with saving Greece and so on. So they probably had their minds elsewhere. And also I agree certainly that regarding the kind of the more micro policy in the EU, they were a bit late for sure. We have one top question here. I must ask this question because it's really the one most voted. 42 actually voted this one. Henrik had cast. There have been 200 civilizations through history all collapsed. Is the European growth challenge a sign of history naturally repeating itself? Clemens. It's a big one but McKinsey is for big question. But kind of the answer is obviously yes. It's just a question of time. In the end we will all die. What do you think, Simeon? I'm actually more optimistic for a change on this. I think fortunately Europe is multicultural. You can enter Europe through many ways no matter how many walls we try to build various countries. And it's still very attractive for basically the rest of the world. So we will be renewing ourselves so to speak. Simply because there are many other people in the world who still want to come to us. And as long as we have more people and we provide some reasonable policies to let them in and integrate them, I think that we will not only grow but basically experience good lives. Philip, you formally worked with McKinsey. I'm really sorry but now you are independent researcher. Do you subscribe to the doom and gloom argument of Clemens? Sorry, Clemens. Yes, I actually agree with both. I note that out of these 200 something civilizations a lot of them were European. So we might be facing a collapse. But I'm sure that if you just wait long enough Europe will be on top again. I'm pretty sure it won't happen when any of us here will be alive. But there's always a risk for that. If you look at the way the world has developed, over the past 200 years we have any growth in the world. Well, it may not last forever. But what about the Brexit? That's also a question. And as Hattura Sadauskas, once more, Eastern European name is wonderful. Will Brexit start a contagion in Europe? That could be detonating this trend towards the final end. Clemens. I think Brexit hopefully is not going to happen. I actually think so. And some of the brokers kind of agree with me. No, but there is something around. If you think about the big dynasties of the world that have lasted centuries. The current European construction of governance, leadership and so on. It's not a construction that's going to carry many, many centuries. That does not mean that we won't be able to improve it and change it and so on. That's obviously going to take time. But obviously if Brexit is going to happen, I think kind of what we can hope for is that that would be the crisis that we need to do some reform. So I'm hopeful that if that would happen, we could actually use it for something good. Some kind of new European renaissance after the terrible middle age. Renaissance, but at least kind of that is a proper cause for self-reflection. Philip. I think Brexit, if it happens or not, but the debate might have the one advantage that it helps Europe to focus on areas where it very quickly and visibly can show that it matters and that actually benefits Europeans. I think a lot of that are in economic areas, the economic integration, digital integration. So in a sense the idea of disintegrating Europe might help it focus because the history of Europe started with the coal and steel community. So it started with a very simple economic idea. And now it must be the digital union. So basically simple ideas that everyone understands. This is good for us. Let's do it. And that might be a benefit of having the Brexit debate. I don't basically think that the UK never been kind of wholeheartedly a member of the EU. So I'm not seeing that risk. You rather keep them out then. I think they have been really trying to get a good deal as possible for a very long time. And maybe it's not that difficult to get on without them. What would be the suggestions if you should go and really have three answers to the European growth challenge? What would be the priorities? What would be the main priorities for you in order to solve the crisis of growth and the trend towards stagnation and old ageing Europe even becoming Japanized? I would say single digital market first. It's easy. You can do it literally in a couple of years. Single capital markets we haven't discussed much but a lot can be done to just finance new companies, new innovation. And number three I would say it takes long time but changing our educational system, particularly university educational system to be more flexible. Less lecturing, more integrated process. Let's figure out how things are. I think technology is going to be a key. I think that is going to be such a large change factor in the next years. So it's not only about digitalization. It is digitalization, it is genetics, it is kind of biomedicine, it is kind of automation and production. It is a technological broad revolution. So I think if we can embrace that, then that is going to be something that is going to shape most of the sectors that we actually need to reform. So I think that's going to be a very, very large enabler. And then secondly I think we should remember kind of why Europe is actually such a great place to live in. And cherish those values which is kind of unbelievably strong. I think we should be really lucky that we are living in this part of the world and have a positive outlook on growing old in this part of the world. So good positive minds. Well I guess reforms will be important. What kind of reforms? Just as Samus presentation showed, there is a great variety of problems within Europe. And therefore suddenly one size fits all and it won't do. But each country will have to consider reforms of course the countries where they have a very large number of people in the labor force. And they should consider what is the problem here, how can we address that. That may be cutting taxes in other places may be different differently. But certainly reforms that are kind of tailored to the specific problems that are most pressing in the different countries. And that was kind of the most important. I think there are also obstacles to growth in Europe and lots of rigidities that could be removed. So I will certainly pinpoint that. What is the biggest rigidity? Pardon? What is the biggest rigidity? Well it is anything from pension ages to labor market regulations that can be liberalised and make it really truly also the European labor market. I will say that. You will have the last shot. I think the most complicated is probably the human capital investment that Simi also mentioned. And I think that is where the most to harvest. But more short term goals I think would be, I would take the point we had in our panel right now is sort of the public sector development. So we are getting the public sector more efficient, higher productivity. That frees resources in the economy. I am seeing a health care of the elderly. So there are actually a lot of efficiency to get there. And that will be very important for creating growth in Europe. And the last thing, the simplest thing of all worlds is TTIP. It basically comes for free. You have to struggle down some special interests. But it will boost our innovation ability, our productivity ability. And it will probably also trigger automatically the digital development in Europe. Okay. Thank you very much to Bo Sandman Rasmussen, Philius Røder, Clemens Jartar, and Simeon Djankov for this wonderful conversation. And thanks to all of you for listening here. And I don't know, I want to give the word once more to Pierre. Please come over here. So I just want to repeat the thanks on behalf of the university to Bo Philipp Clemens, sorry, Simeon. For thought provoking. Well, I have to say you didn't quite get to answering all the questions that I sort of thought I cleverly put. I thought the one on, I think Philius actually got off the hook a little bit too easy on the, where you sort of say, well, yes, Europe is down the drain. Well, they're probably down the drain, but eventually. So, you know, I had this question about the Roman Empire collapsing. Yes, we came back. But it took an awful long time. So, but anyway. So we'll have to go away and think a little bit more about this along with you guys. And I hope that all of you younger guys got a lot of inspiration to work on. So now you can start pestering econ professors and other on ideas for MSC dissertations, et cetera. Ph.D. projects sort of falling from this. So I urge you to do that. And remember that I am the head of the graduate school. To get a look at this and prioritize things. So I would like to see much more on that. Because one of the things I see in that sort of a personal side remark. Of course, econ as a science seen from the head of graduate school is becoming very, very fragmented. I realize, and I know the bulls involved and Philius involved and others, that of course you have to learn the tools of the trade before you can master and address the bigger questions. However, of course, there is also the risk that you spend ten years getting into the nitty gritty of too much detailed methodologies. So sometimes I get the idea that there may be too few sort of projects opened up to sort of address bigger questions. So that's just a thought. Anyway, that's not your fault. So thank you again. I think you should give these guys a warm round of applause yet again. And then I'll give the word to Fakker for some final remarks. Boris, so big round of applause for these guys. Can I have the mic? Thank you. So first of all, thank you everyone for joining us. It has been a really, really interesting experience. And we have already counted who have been the two most voted questions. And we have two winners. The winner is Henrik, who asked the question about the doomed civilization and if Europe is going to follow. Henrik, would you please mind joining us here on stage? And the second winner, and the second winner is Marcel for asking the question whether growth may actually come at a cost. So this is the second most voted question. Round of applause for Marcel and to Henrik, congratulations. So we have these two books, so the great rebirth lessons from the victory of capitalism over communism. Congratulations Henrik, that's for you on behalf of Professor Simon Djankov and as well Fakker. So you also have the opportunity to have it personally signed by him. You have the honor to get one of the latest books of Mr. Simon Djankov, which is Inside the Euro Crisis Eyewitness Account. Congratulations. Let's give them one round of applause for asking the provocative questions. Finally, this concluded our last part of the event, which was the public debate. However, we also need to mention a few very, very important organizations without which this event would have never been what it was. First of all, I would like to thank our sponsors. This has been Ohus BSS, the Department of Economics and Business Economics for the generous financial support. As well as Ohus BSS for the organizational support. Einar Hessell and Mercedes Benz, who have been the official transportation partner of this event, ensuring that our panelists travel in the utmost comfort. As well the Tuberg Foundation, who has been so generous as well to sponsor a big part of the financial burden of this event. And we have a Fakker. Once again, I would like to thank you for your active participation, for asking not only the obvious questions, but also the hard questions, as we saw. With these words, I'll wrap it off and I would invite you please to join us for a mingling session, networking and as well a little bit of food. Thank you very much for being an active part of Ohus.