Saving the euro requires restoring Spain’s competitiveness
Delbecque, Bernard. The escalation of the crisis in the Eurozone calls for new measures to reduce yields on Spanish and Italian bonds. This column succinctly lays out the options and finds them wanting. It argues that sovereign bond purchases might not be sufficient to reassure investors. A credible solution will also require a coordinated strategy […]
US unemployment: Neither natural nor unnatural
Calvo, Guillermo, Coricelli, Fabrizio & Ottonello, Pablo. Economic output in the US seems to have recovered since the Great Recession – but jobs have not. This ‘jobless recovery’ has led economists to argue that unemployment has reached a point where it can fall no further without further inflation. This column disagrees, suggesting the nature of the crisis […]
A simple model of multiple equilibria and default
Gros, Daniel. This Working Document by Daniel Gros presents a simple model that incorporates two types of sovereign default cost: first, a lump-sum cost due to the fact that the country does not service its debt fully and is recognised as being in default status, by ratings agencies, for example. Second, a cost that increases […]
Central Banks in Times of Crisis: The FED vs. the ECB
Gros, Daniel, Alcidi, Cinzia & Giovannini, Alessandro. Different economic and financial structures require different crisis responses. Different crises also require different tools and resources. The first ‘stage’ of the financial crisis (2007-09) was similar on both sides of the Atlantic, and the response was also quite similar. The second stage of the crisis is unique to […]
Towards a sustainable recovery
Rajan, Raghu. To understand how to achieve a sustained recovery from the Great Recession, we need to understand its causes. And identifying causes means starting with the evidence. Πηγή: forums.chicagobooth.edu πλήρες κείμενο
Breaking the vicious cycle: Restoring balanced and sustainable growth in the global economy
Cecchetti, Stephen, Hofmann, Boris. The global economy is still suffering. This column assesses the structural adjustments, monetary and fiscal policy measures, and financial reforms that are needed to break the vicious cycle of weak growth, impaired financial systems, risks to fiscal sustainability and being propped up by monetary policy. Πηγή: Voxeu πλήρες κείμενο
Όταν ο Keynes έβαλλε κατά της θετικοποίησης των οικονομικών…
«Η υπερβολικά μεγάλη δόση, πρόσφατα, “μαθηματικών οικονομικών” δεν είναι παρά απλή επινόηση, τόσο μάλιστα ανακριβής όσο οι αρχικές υποθέσεις πάνω στις οποίες στηρίζονται, που επιτρέπουν στον συγγραφέα να χάσει την πολυπλοκότητα και την αλληλεξάρτηση του πραγματικού κόσμου σε έναν κυκεώνα εξεζητημένων και άχρηστων συμβόλων» (Keynes, 2010: 322). Και συμπληρώνει γράφοντας πως η πολυπλοκότητα της πραγματικότητας […]
The death of Inflation Targeting
Frankel, Jeffrey. The current economic crisis has called into question the role of monetary policy, particularly Inflation Targeting and its oversight of asset bubbles and supply side shocks. This column is an obituary to Inflation Targeting and call for Nominal GDP Targeting to replace it. Πηγή: Voxeu πλήρες κείμενο
International rules for capital controls
Jeanne, Olivier, Subramanian, Arvind & Williamson, John. Do we need international rules for capital controls? This column looks at the different regimes in countries such as Brazil and China and argues that we do. Although economists generally agree that countries can derive substantial gains from international economic integration, the extent to which they should open themselves to […]
The Nordic Model’s Economic Appeal
Sachs, Daniel. Even on the global stage, there is a lot of talk about the benefits of the “Nordic” model of society. Is that because of hard facts or because of soft values? Is it because of a belief in the importance of solidarity and inclusion in a society? As a businessman and financier, Daniel […]