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lugaricano.bsky.social
Luis Garicano
@lugaricano.bsky.social
2.4K followers 98 following 100 posts

Economist. Professor @LSE SPP My webpage: https://sites.google.com/site/luisgaricano/ Substack (innovation, econ., Europe): SiliconContinent.com My book on the Euro is out on June 2025.

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Business 25%
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · May 28
As long term rates increase, the problems that created the doom loop in Europe are unsolved. Why? Italy's politicians like to have a captive buyer of debt. And German politicians like to control €2.5 trillion through local Sparkassen.
My post today:
www.siliconcontinent.com/p/the-return...
The Return of the Doom Loop?
Higher yields expose Europe's unfinished banking union
www.siliconcontinent.com
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Reposted by Luis Garicano

andylangenkamp.bsky.social
Andy Langenkamp @andylangenkamp.bsky.social · Aug 4
@lugaricano.bsky.social: You cannot win a trade war against the army that protects you. Our weakness is Russia. With a threatening Russia on our doorstep, and the Ukraine war ongoing, Europe cannot afford any break with the US www.siliconcontinent.com/p/the-turnbe...
The surrender in Turnberry
11 thoughts on the EU-US trade deal
www.siliconcontinent.com
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Reposted by Steven G. Medema, Mark E. Schaffer, Luis Garicano , and 1 more

bengolub.bsky.social
Ben Golub @bengolub.bsky.social · Jan 15
The discussion ending at this tweet is very smart on both sides ( @lugaricano.bsky.social and @shengwuli.bsky.social ), reasonably spicy, and fun to read.
lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Jan 14
I don't think the argument for the price system rests on full information. I think it rests on Hayek 1945, hence precisely on dispersed local knowledge --i said that before. But let's leave it here. I think we clarified quite a bit, and I hope some of our readers (if there are any!) learned a bit.
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Jun 18
Today in SiliconContinent, Klaus Masuch and I explain carefully the redistribution of risks that are an inevitable consequence of modern monetary policy (QE etc.) and the huge transfers of wealth that have in fact taken place as a result. www.siliconcontinent.com/p/the-hidden...
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Reposted by Luis Garicano

kayjebelli.bsky.social
Kay Jebelli @kayjebelli.bsky.social · Jun 4
This turns the single market on its head, it's exactly what people like
@lugaricano.bsky.social‬ have been talking about, when they say that the modern EC is failing at its raison d'être, where the economy is concerned.

Enforcing a single market.
www.siliconcontinent.com/p/the-myth-...
The myth of the single market
Why Europe’s internal barriers are higher than Trump's tariffs
www.siliconcontinent.com
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Reposted by Jonathan Parker, Jonathan B. Baker, Luis Garicano

proffionasm.bsky.social
Fiona Scott Morton @proffionasm.bsky.social · Jun 4
I have a new book! Digital Platform Regulation. Fun analysis of what society should do to get some competition out of of our favorite gatekeeper platform. Relevant to the DMA and US antitrust remedies. And free! Download here:
som.yale.edu/centers/thur...
Digital Platform Regulation
som.yale.edu
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · May 14
I explain today why the Single market is broken: mutual recognition is not what we think it is; harmonisation actually fragments, and the Commission is not doing its core job. If you only ever read one post of Silicon Continent, let it be this one.
www.siliconcontinent.com/p/the-myth-o...
The myth of the single market
Why Europe’s internal barriers are higher than Trump's tariffs
www.siliconcontinent.com
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Reposted by Luis Garicano

guntramwolff.bsky.social
Guntram Wolff @guntramwolff.bsky.social · Apr 9
How to pay for European defense - a nice review of our @bruegel.bsky.social report with @steinbacharmin.bsky.social and @jzettelmeyer.bsky.social by @lugaricano.bsky.social www.siliconcontinent.com/p/how-to-pay...
How to pay for European defense
The proposal for a European Defense Mechanism
www.siliconcontinent.com
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Reposted by Luis Garicano

andrewduffeu.bsky.social
Andrew Duff @andrewduffeu.bsky.social · Mar 22
Ukraine is the test case. "If the bloc fails to act decisively, it risks remaining caught between a dysfunctional confederation and the 'ever closer union' it hopes to become." @lugaricano.bsky.social @politico.eu www.politico.eu/article/hung...
How to confront Orbán and save the EU
The legal tools to address this internal opposition exist — Europe just needs to use them, and meet the moment with courage.
www.politico.eu
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Reposted by Luis Garicano

jcremer.bsky.social
Jacques Crémer @jcremer.bsky.social · Mar 12
This blog post by @pietergaricano.bsky.social while ostensibly about education makes crucial points about the limits of European policies, which are specially relevant as we think of industrial policy.

www.siliconcontinent.com/p/policies-w...
Policies without Politics
The European Commission has set its sights on education.
www.siliconcontinent.com
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Reposted by Luis Garicano

lsepublicpolicy.bsky.social
LSE School of Public Policy @lsepublicpolicy.bsky.social · Mar 12
Europe’s economy is in trouble. Our Professor of Public Policy @lugaricano.bsky.social recently featured on the @economist.com podcast “Money Talks” to discuss the challenges facing Europe’s leaders today. 🇪🇺🎧

www.economist.com/podcasts/202...
The European economy has a Trump problem
Our podcast on markets, the economy and business. This week, we discuss the numerous threats to Europe’s shaky economy
www.economist.com
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Reposted by Luis Garicano

mattabrams.org
Matt Abrams @mattabrams.org · Mar 8
@lugaricano.bsky.social @hooverinstitution.bsky.social www.linkedin.com/posts/mattab...
Matt Abrams on LinkedIn: Trading with Bullies | annotated by Matt
Valuable reads from John H. Cochrane and Luis Garicano and opens up as many questions as answers as I call out below. One overarching statement, however, our…
www.linkedin.com
1

Reposted by Luis Garicano

c-abbs.bsky.social
Chris Abbott @c-abbs.bsky.social · Mar 8
open.substack.com/pub/siliconc...

Excellent piece by @lugaricano.bsky.social
Trading with Bullies
Economics for a Hard-Power World
open.substack.com
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Reposted by Luis Garicano

ictlogist.bsky.social
Ismael Peña-López @ictlogist.bsky.social · Mar 5
Esplèndid text de @lugaricano.bsky.social sobre el concepte "externalitats sobre la seguretat nacional" i com aquest concepte pot ajudar a comprendre (i a actuar) els canvis sobre comerç internacional, proteccionisme i subvencions a la producció nacional

1/2
www.siliconcontinent.com/p/trading-wi...
Trading with Bullies
Economics for a Hard-Power World
www.siliconcontinent.com
1 1 2

lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Mar 5
"Trading with Buliles"
How to think like an economist in a world of hard power.
- The national security externality
- Strategic sectors
- When integration encances resilience.
Including fascinating new work on Geoeconomics (Maggiori, Becko, Kooi)

www.siliconcontinent.com/p/trading-wi...
Trading with Bullies
Economics for a Hard-Power World
www.siliconcontinent.com
8 18

lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Mar 3
Good point by Martin, which i missed at the time. Sorry.
Martin Sandbu @martinsandbu.ft.com · Nov 27
Important thread from @lugaricano.bsky.social. I agree with his prescription - and that undermining banks' subsidised profits is a feature, not a bug, of digital cash. I'm more sympathetic to the ECB - but that's because I think once we have a digital euro, the limits will be impossible to sustain.
lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Nov 27
An alternative: Let people hold unlimited digital euros at the ECB. Use the money to buy public debt at market rates (like currently with reserves).

Get stability without sacrificing liquidity. But that would threaten banks' subsidized profits.
9/10
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Reposted by Luis Garicano

verfassungsblog.de
Verfassungsblog @verfassungsblog.de · Mar 3
Ukraine needs to join the European Union as fast as possible.

Neither Trump nor Putin can veto this!

ANDREW DUFF advocates for the fast-track accession and calls for a revision of its terms and conditions:

verfassungsblog.de/fast-trackin...
The first step must be to reverse the unorthodox incursion of unanimity into Council decision making on enlargement.
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Reposted by Luis Garicano

codendahl.bsky.social
Christian Odendahl @codendahl.bsky.social · Feb 24
Our leader on #Merz and the debt brake. Get rid of it, and do it now.

www.economist.com/leaders/2025...
Germany’s election victor must ditch its debt rules—fast
Friedrich Merz has weeks to shore up his country’s defences
www.economist.com
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Reposted by Luis Garicano

jasonfurman.bsky.social
Jason Furman @jasonfurman.bsky.social · Feb 23
COVID ripped apart economies around the world. Amazingly most rich countries snapped back almost completely very quickly. By the end of 2021, 12 of 27 advanced OECD economies had unemployment rates below pre-COVID forecasts. The US did not. In fact, it was the fourth worst.

A 🧵
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 18
thanks Wojtek! done!
L
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 18
The "Geopolitical Commission"is lot of talk of industrial policy, strategic autonomy, no work on the basic (boring?) tasks.

Services are 70% of our economy, little has been done. Mr. Breton Single Market effort was lackadaisical at best. I hope better of S. Sejourné

8/8
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 18
QUANTITIES:

EU trades more with the rest of the world, less with itself.

1) Trade between EU countries is less than half the level between US states.

2) Since 1999, as % of GDP:

Eurozone trade has grown 31% → 55%
China trade: 34% → 37%
US trade: 23% → 25%
7/
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 18
QUANTITIES:

The result in quantities is stunning:

EU internal and external services trade are roughly equal as % of GDP - unthinkable in a properly functioning single market.

Internal barriers are pushing activity outward.
6/
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 18
Europe has effectively raised internal tariffs while lowering external ones - precisely the opposite of what a single market should do.

The results are devastating, as the next tweets show.
5/
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 18
The Commission's regulatory approach to digital services (70% of GDP!) has backfired. Example: GDPR compliance costs have cut small European tech firms' profits by up to 12%.
4/
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lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 18
PRICES:
IMF shows that EU internal barriers are equivalent to:
- A 45% tariff on manufacturing,
- A 110% on services.

As services become more important in the economy, barriers on service trade create an even bigger drag on growth.

2/
www.ft.com/content/13a8...
Forget the US — Europe has successfully put tariffs on itself
High internal barriers and regulatory hurdles are far more damaging for growth than anything America might impose
www.ft.com
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Reposted by Luis Garicano

stevecicala.bsky.social
Steve Cicala @stevecicala.bsky.social · Feb 17
If you thought @jasonfurman.bsky.social 's FA piece was too subtle in its distinction between "tradeoff" as a well-defined economic concept and its common usage, you might get the point with this amazing post on the SuperBonus by @lugaricano.bsky.social.
www.siliconcontinent.com/p/how-to-inc...
How to torch 220 billion euros
When the ECB, Brussels, and Markets All Looked Away
www.siliconcontinent.com
3

Reposted by Luis Garicano

sandertordoir.bsky.social
Sander Tordoir @sandertordoir.bsky.social · Feb 15
I guess it isn't to everyone. But the fact of the matter is that not only Germany is rapidly losing export markets to China, but Europe at large.

China's exports are growing at a 10% y-o-y clip, world trade around 3%, eurozone exports are languishing (and yes that also hits CEE by extension). 4/x
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Reposted by Luis Garicano

ictlogist.bsky.social
Ismael Peña-López @ictlogist.bsky.social · Feb 15
Fantàstic @lugaricano.bsky.social sobre política fiscal i monetària europea i, en definitiva, sobre una Unió que és poc més, encara, que un club d'estats que van per lliure.
(l'estudi del cas italià és simplement esgarrifós)
www.siliconcontinent.com/p/how-to-inc...
How to torch 220 billion euros
When the ECB, Brussels, and Markets All Looked Away
www.siliconcontinent.com
1 2

Reposted by Roberto Galbiati

lugaricano.bsky.social
Luis Garicano @lugaricano.bsky.social · Feb 14
Today in Silicon Continent, the astonishing story of a "stimulus" gone wrong-- the 220 billion Italian superbonus. The ideas and the political economy of why it took off, and why it was unstoppable.
www.siliconcontinent.com/p/how-to-inc...
How to incinerate 220 billion euros
When the ECB, Brussels, and Markets All Looked Away
www.siliconcontinent.com
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