Download or read book Transforming the European Economy written by Martin Neil Baily and published by Peterson Institute for International Economics. This book was released on 2004 with total page 372 pages. Available in PDF, EPUB and Kindle. Book excerpt: As industries evolve and restructure, the ability of an economy to adapt to new economic conditions - its ability to change direction - determines its success over the long run. Europe and Japan grew rapidly for many years, but now, faced with greater challenges, their economies have either failed to generate enough jobs or have failed to achieve the highest levels of productivity (or both). While the US has economic problems, the advantage of its greater flexibility has allowed it to be alone among the three powers in sustaining very high productivity and very strong employment opportunities. In this text, Martin Neil Baily examines the policies that should be followed to facilitate economic adjustment and rapid economic growth in the new environment. He emphasizes three key forces driving a change of direction: expanded global competition; the increased use of information and communications technologies; and the development of the global financial system. Baily says that these have created a new economy due to increased intensity of competition, as well as altered demand patterns and changes in the way businesses operate.