The Anatomy of Global Economic Uncertainty
El-Erian, Mohamed. The sense of uncertainty prevailing in the West is palpable, and rightly so. People are worried about their futures, with a record number now fearing that their children may end up worse off than them. Unfortunately, things will become even more unsettling in the months ahead. Πηγή: Project Syndicate πλήρες κείμενο
Does openness generate growth? Reconciling the experiences of Mexico and China
Kehoe, Timothy, Ruhl, Kim. In 1985, Mexico opened itself to trade and investment. In recent years, China has followed the same path with much more impressive results. But this column argues that the slow growth and crises that Mexico experienced after the initial boom should act as a warning to those optimistic about China. Πηγή: Voxeu […]
How does monetary policy respond to financial stress?
Baxa, Jaromír, Horváth, Roman & Vašíček, Bořek. Central bankers focused too much on inflation targets and too little on financial stability – so the criticism goes. This column examines the evidence, with a look at the world’s five major central banks over the last 30 years. Πηγή: Voxeu πλήρες κείμενο
Delivering growth while reducing deficits: lessons from the 1930s
Crafts, Nicolas. Conditions in the 1930s were very similar to those found today: interest rates were already low, the government deficit needed to come down, and the world economy was in disarray. Yet the UK economy grew by almost 20 per cent between 1933 and 1937. This success was built on the government announcing that prices […]
The Problem that Wasn’t: Coordination Failures in Sovereign Debt Restructurings
Bi, Ran, Chamon, Marcos & Zettelmeyer, Jeromin. Contrary to widespread expectation, debt renegotiations in the era of bond finance have generally been quick and involved little litigation. We present a model that rationalizes the initial fears and offers interpretations for why they did not materialize. When the exchange offer is sufficiently attractive vis-à-vis holding out, full participation […]
The financial trilemma in China and a comparative analysis with India
Aizenman, Joshua, Sengupta, Rajeswari. Emerging markets face what some economists are calling a trilemma. They cannot simultaneously target exchange-rate stability, conduct an independent monetary policy, and have full financial integration. So what to do? This column looks at how Asia’s giants are responding – and in different ways. Πηγή: Voxeu πλήρες κείμενο
Cross-Border Banking in the Balance
Berglof, Erik. The gravity of the eurozone crisis has finally sunk in. The stakes could not be higher. Governments and international financial institutions have scrambled to put together a solution within exceedingly tight political and economic constraints. Many questions have yet to be answered about the design; implementation will be at least as challenging. Πηγή: […]
The Undeserving One Percent?
Rajan, Raghuram. It is amazing how the “one percent” epithet, a reference to the top 1% of earners, has caught on in the United States and elsewhere in the developed world. In the United States, this 1% includes all those with a 2006 household income of at least $386,000. In the popular narrative, the 1% […]
Clear thinking about economic policy
Backus, David, Cooley, Thomas. For some, the fiscal problems in the US and Europe are a case of bad politics getting in the way of good economics. This column argues that there was plenty of bad economics as well. It looks at the work of the two recent Nobel Laureates in offering some clear thinking. Πηγή: […]
Manufacturing is special
Rodrik, Dani. Poor countries have access to world markets and rich countries’ technologies. In principle, they should catch up. Yet the record belies this expectation. But this column argues labour productivity in manufacturing displays a clear tendency towards convergence, unconditional on the countries’ institutions or policies. The policies that matter for growth are thus those […]