The Other Financial Crisis
El-Erian, Mohamed. Two variants of financial crisis continue to wreak havoc on Western economies, fueling joblessness and poverty: the one that we read about regularly in newspapers, involving governments around the world; and a less visible one at the level of small and medium-size businesses and households. Until both are addressed properly, the West will […]
Seeing Our Way Through The Crisis: Why We Need Fiscal Transparency
Cottarelli, Carlo. Without good fiscal information, governments can’t understand the fiscal risks they face or make good budget decisions. And unless that information is made public, citizens and their legislatures can’t hold governments accountable for those decisions. Πηγή: iMFdirect πλήρες κείμενο
What’s the use of economics?
Kirman, Alan. The economic crisis has thrown the inadequacies of macroeconomics into stark relief. This column argues that the narrow conception of the macroeconomy as a system in equilibrium is problematic. Economists should abandon entrenched theories and understand the macroeconomy as self-organising. It offers detailed suggestions on what alternative ideas economists can teach their future […]
From Great Depression to Great Credit Crisis: similarities, differences and lessons
Almunia, Miguel, Bénétrix, Agustín, Eichengreen, Barry, O’Rourke, Kevin & Rua, Gisela. The Great Depression of the 1930s and the Great Credit Crisis of the 2000s had similar causes but elicited strikingly different policy responses. While it remains too early to assess the effectiveness of current policy, it is possible to analyse monetary and fiscal responses in the […]
The Only Game in Town
Rajan, Raghuram. What should central banks do when politicians seem incapable of acting? Thus far, they have been willing to step into the breach, finding new and increasingly unconventional ways to try to influence the direction of troubled economies. But how can we determine when central banks overstep their limits? When does boldness turn to […]
Coping with financial crises: Latin American answers to European questions
Cavallo, Eduardo, Fernandez-Arias, Eduardo. The Eurozone body politic seems to be slowly learning the lessons for crisis management. This column argues that Latin America’s decades of financial crisis can provide key insights for Europe. Πηγή: Voxeu πλήρες κείμενο
Fact-checking financial recessions
Schularick, Moritz, Taylor, Alan. The central part played by credit in the deep downturn and weak recovery fits a recurring historical pattern. Financial crises correlate with more painful recessions. This column takes a close look at 14 advanced economies over the past 140 years and shows that larger credit booms during expansions have been systematically associated […]
Two Problems with Austrian Business-Cycle Theory
Even though he has written that he no longer considers himself an Austrian economist, George Selgin remains sympathetic to the Austrian theory of business cycles, and, in accord with the Austrian theory, still views recessions and depressions as more or less inevitable outcomes of distortions originating in the preceding, credit-induced, expansions. In a recent post, […]
Central Banks on the Offensive?
Pisani-Ferry, Jean. It looks like a coordinated offensive: on September 6, the European Central Bank outlined a new bond-buying program, letting markets know that there were no pre-set limits to its purchases. On September 13, the United States Federal Reserve announced that in the coming months it would purchase some $85 billion of long-term securities […]
Notes On Internal Devaluation
Still in jet-lag city. Talking to people, and also reading what comes across the threshold, it occurs to me that there’s widespread misunderstanding of what a more or less Keynesian view of Europe’s problems actually implies. People seem to think that it means that (a) internal devaluation can never work (b) any sign of recovery, […]