Today’s Irish Times carries an interview with Joseph Stligitz. A striking element is his advocacy of a uniform cut in wages and prices (the internal devaluation option), as the substitute for the nominal devaluation strategy that has been pursued by several countries with independent currencies. He also highlights the importance of fairness in pursuing this option. While he does not describe in detail how this can be achieved, my own work has advocated a twin-track strategy: wage reductions, coupled with more vigorous pro-competition policies to ensure that wage cuts are not simply absorbed into higher markups.