Spain in the Wake of the Crisis: Reforms or Adjustment?

27 Pages Posted: 27 Sep 2016  

Ramon Xifre

Universitat Pompeu Fabra; University of Navarra, IESE Business School

Date Written: July 12, 2016


This paper examines how a set of economic indicators have changed in Spain before and after the last round of reforms were passed. This analysis provides some stylized facts of the Spanish recovery. The current account balance and the main competitiveness indicators started to improve in 2009 before any major reform had been adopted. The robust growth of the Spanish economy depends, just as before the crisis, virtually on domestic demand alone. In the labour market, net jobs have been created after the reform but by substituting permanent for temporary contracts. Unemployment is increasingly becoming a longer, and more vulnerable condition. Innovation activity in firms is in free fall. Part of all this is not attributable to the reforms, but rather to deeper limitations of the Spanish economy. All in all, the case for a private sector-led, "automatic" adjustment after 2008 is stronger than the one to be made for recovery through reform.

Keywords: Spain, structural reforms, competitiveness, recovery, adjustment

JEL Classification: D22, E01, E24, F14,

Suggested Citation

Xifre, Ramon, Spain in the Wake of the Crisis: Reforms or Adjustment? (July 12, 2016). IESE Business School Working Paper No. Working Paper WP-1141-E. Available at SSRN: or

Ramon Xifre (Contact Author)

Universitat Pompeu Fabra ( email )

Ramon Trias Fargas, 25-27
Barcelona, E-08005

University of Navarra, IESE Business School

Avenida Pearson 21
Barcelona, 08034

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