In Chart 4, labor’s share of income has shown a significant increase, which on the other hand means a substantial decrease in return on capital since the bursting of the bubble. Needless to say, capital is an important factor of production supporting economic development. If capital cannot generate sufficient returns for a long period, it will become difficult for firms to raise capital.
Therefore weak growth could be a factor entailing growing euroscepticism, especially in Western Europe. For the coming months a reasonable optimism is justified. While the latest positive signals need to be confirmed by future developments, they underpin the expectation that the gradual recovery in the euro area will continue and will strengthen over time. The conditions are in place.