In the past, regional shocks would have led to a persistent divergence in employment rates across provinces. Between 1976 and 1997, the average difference between employment rates in any one province and the national rate was 5.5 percentage points. This was much higher than the corresponding gap in the United States.
For example, in a debt overhang environment it is not clear that accommodative monetary policy is inimical to balance sheet repair. In many countries low interest rates have in fact helped stabilise debt dynamics via reduced interest rate burdens, and thereby facilitated balance sheet adjustment. The interest spending-to-GDP ratio of euro area governments has declined on average by 0.4 p.p.