Investing Our Way Out of the Crisis?

The controversy over fiscal multipliers has sparked a new debate on the negative effects of austerity measures and a discussion of the need for more public spending in Europe. In this context, the idea of increased investment financing through public investment banks has gained momentum. The authors see a strong role for such banks: The European Investment Bank, they say, is well suited to fill the existing investment gap through favorable loans, particularly to small & medium sized enterprises.