Crisis in Slovenia: Roots, effects, prospects

Marko Kržan

Abstract


The author examines the last 20 years of Slovenian economic history. He argues that export-led economic model based on depreciated domestic currency and capital controls enabled stabilization and convergence with developed EU economies until 2004. The period of debt-led growth characterized by instability and recurrent recession after 2008 is explained by dissolution of the earlier economic model after Slovenia’s accession to EU. A brief comparison is then made that reveals a striking resemblance with the case of Portugal which joined ERM about a decade earlier. From this it is inferred that the crisis is structural and that no simple return to earlier economic models could secure further convergence.

Keywords


Slovenia, economy, crisis, economic development

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