And this debate is currently obscuring the consensus on the longer-term effects of consolidation. This is because the debate relates directly to policy decisions and to their short-term effects on which politicians are very strongly focused. More specifically, the debate is focusing on the appropriate pace of consolidation in the current circumstances. The discussion, therefore, is revolving around the size of the fiscal multiplier.
Those who wonder why interest rate margins range between 4 and 7 percentage points in a majority of transition countries, and between 4 to 5% in EU countries, i.e.