ABSTRACT
The Spanish crisis is generally portrayed as resulting from excessive spending by households associated to a housing bubble and/or an excessive welfare spending beyond the economic possibilities of the country. We put forward a different hypothesis. We argue that the Spanish crisis resulted, in the main, from a widening deficit position in the non-financial corporate sector and a declining trend in profitability under a regime of financial liberalization and loose and unregulated lending practices.
KEYWORDS:
Euro; macroeconomic crisis; Spain
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Source: Authors’ own computations on the basis of Eurostat (2015).
Source: Authors’ own on the basis of the financial accounts of the Spanish economy. Bank of 
Source: Authors’ own on the basis of the statistical bulletin of the