Question

Why s Northern Europe is more developed than Southern Europe? What impact does this economic disparity have on the Euro, government debts, trade, and labor markets today in the EU?

Answer 1

Some of the reason why Northern Europe is more developed than Southern Europe are listed below:

• Countries on the southern Europe had hangovers form WW2 and faced big setback on political or economic conditions.
• Since modern business mainly rely on ability to trade easily at scale and it makes products available to population at a low cost. It is so difficult in southern countries to scale distribution.
• Corruption is seen as a part of business and life in most of the southern countries. It results in deterioration of economy.
• Many backhanders play result in low investment and encourage less entrepreneurs and looks for out of low solution as compared to northern countries like Britain or France.
• Climate also plays an important role in the major difference between southern and northern Europe as Southern countries are having cold climate in some months whereas it is comfortable for Northern countries for most of the time. It thus largely affects the production.

The huge economic dispariy is having a large impact as Britain left EU due to wide disparities.This wide disparity was due to collapse of financial institutions in several European countries which resulted in the European sovereign debt crisis. Many of the Southern countries were unable to repay their government debt, mainly by the end of 2009. They needed the assistance of a third party. By 2013 they slowly began to recover from this crisis. Euro is facing some difficulty due to large investments in America, which caused investment to reduce in EUROPE. Another issue is ageing. Low birth rate is a serious issue which has an impact on future economy and aged population is high compared to most of the Northern and other developed countries.