Contrary to popular wisdom, the best way to improve our living standards may not be to “re-industrialise” Europe but rather to make services more productive. So what can policymakers do?
Implications for the financial sector So there is no doubt that our measures are having their desired effect. Yet unconventional monetary policy can have side effects as well, and especially for the financial sector. One key concern is their impact on banks’ profitability – which remains generally weak in the euro area – and especially on net interest income.