125229 20230519145629.0 doi 10.1093/cje/beab010 sideral 132070 ART-2021-132070 eng Barba, J. C. The timely overestimation of Spanish GDP in the great recession 2021 Access copy available to the general public Unrestricted The inefficient institutional design of the Euro allowed guaranteed bank liabilities to be converted into government debt, deepening the Great-Recession in Southern European countries. A recessive feedback process occurred through an increase in sovereign debt risk premiums in a cycle of global risk aversion. However, there was one fact that limited these negative effects. We refer to the overestimation of Spanish gross domestic product (GDP) in the public accounts for the period 2007–2013. We quantified the unexplained overestimation of Spain’s GDP for the period 2007–2013 using three different methodologies, which leads us to a similar conclusion: Spain’s GDP was overestimated by between 17% and 18%. We demonstrate that this overestimation allowed for significant savings in interest payments through a lower risk premium. This overestimation, unknown to investors, shows that markets are not efficient, and that information is incomplete. It is necessary to understand the role of debt under Hyman Minsky financial instability hypothesis. info:eu-repo/semantics/openAccess All rights reserved http://www.europeana.eu/rights/rr-f/ 2.273 2021 ECONOMICS 175 / 382 = 0.458 2021 Q2 T2 1.102 2021 Economics and Econometrics 2021 Q1 3.9 2021 info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion Laborda, J. (orcid)0000-0002-2132-2151 Laborda, R. 45, 3 (2021), 427-456 Camb. j. econ. CAMBRIDGE JOURNAL OF ECONOMICS 0309-166X 622318 http://zaguan.unizar.es/record/125229/files/texto_completo.pdf Versión publicada 1933811 http://zaguan.unizar.es/record/125229/files/texto_completo.jpg?subformat=icon icon Versión publicada oai:zaguan.unizar.es:125229 articulos driver 2023-05-18-16:19:58 ARTICLE