Are business cycles and economic structures compatible?
Britain’s economic cycle is now more aligned with the eurozone than in 1997 but structural differences remain. If problems emerge is there sufficient flexibility to deal with them? Both the British and eurozone economies have become more flexible in recent years, but there are still rigidities in European labour markets and policy-making. Would joining eurozone create better conditions for firms making long-term decisions to invest in Britain? Britain is still the most popular destination for overseas investment in the EU. However, some inward investors have called for euro entry. What impact would entry into eurozone have on the competitive position of the UK’s financial services industry? The City appears not to have suffered from being outside the eurozone, and may not be greatly affected either way. The main regulatory initiatives are at an EU, not eurozone level. Will joining eurozone promote higher growth, stability and a lasting increase in jobs? Growth and employment would be h
