The gains at the national level from such measures would be significant where there are large domestic investment needs and reform gaps. In all large euro area countries, net public investment[47] has essentially been zero over the last decade.
Private defaults often mean public rescues of banking sectors; recessions fed by deleveraging usually prompt expansionary fiscal policies. This means that the public  1  C. M. Reinhart and K. S. Rogoff, “A Decade of Debt,” National Bureau of Economic Research Working Paper No. 16827, Cambridge, 2011.