Over the long term, higher productivity growth and better-functioning labour markets are vital if economies in southern Europe are to regain the competitive ground they lost in the first decade of monetary union, when their unit labour costs soared relative to those in northern countries like Germany.

ECONOMIST: Free exchange

Sydney was 25% cheaper to live in than New York a decade ago, according to the Economist Intelligence Unit.

WSJ: Zurich Is World's Costliest City

Growth has been dismal over the past decade (Mr Berlusconi was an economic calamity) and unit labour costs have risen sharply.

ECONOMIST: The Merkel memorandum