Unemployment, labour-market flexibility and IMF advice: Moving beyond mantras
Blanchard, Olivier, Jaumotte, Florence & Loungani, Prakash. The state of labour markets in advanced economies remains dismal despite recent signs of growth. This column explains the IMF’s logic behind the advice it provided on labour markets during the Great Recession. It argues that flexibility is crucial both at the micro level, i.e. on worker reallocation, and […]
Sovereigns versus banks: Crises, causes and consequences
Jordà, Òscar, Schularick, Moritz & Taylor, Alan. In the aftermath of the global financial crisis, few would dispute the risks of excessive borrowing. But which debts should one worry about – public or private? This column presents new research on the interplay of public and private debts since 1870 in 17 advanced economies. History demonstrates that […]
Five On The Floor
Krugman, Paul We’re coming up on the fifth anniversary of an important moment: the point at which US interest rates hit the zero lower bound, and we entered a liquidity trap. Five years! Yet many people, even many economists, are still in denial over what that means. Πηγή: The New York Times πλήρες κείμενο
The Greek Debt Restructuring: An Autopsy
Zettelmeyer, Jeromin, Trebesch, Christoph & Gulati, Mitu. The Greek debt restructuring of 2012 stands out in the history of sovereign defaults. It achieved very large debt relief—over 50 percent of 2012 GDP—with minimal financial disruption, using a combination of new legal techniques, exceptionally large cash incentives, and official sector pressure on key creditors. But it […]
Fiscal Consolidation in the Euro Area: How Much Can Structural Reforms Ease the Pain?
Anderson, Derek, Hunt, Ben & Snudden, Stephen. The IMF’s Global Integrated Monetary and Fiscal model (GIMF) is used to examine the scope for structural reforms in the euro area to offset the negative impact of fiscal consolidation required to put public debt back on a sustainable path. The results suggest that structural reforms in core […]