Challenges loom for Lagarde in new IMF post
Lombardi, Domenico. The IMF has just elected the first woman to its managing directorship, and already Christine Lagarde’s new desk in Washington is piling up with folders eagerly awaiting her arrival. First folder: the Greek crisis and the IMF’s role. In an attempt to fill the European institutional vacuum, under its previous leadership the IMF […]
Bank Regulation’s Capital Mistake
Bhidé, Amar. Imagine that the arguments triggered by the Hindenberg disaster were about the fire extinguishers and parachutes that airships should carry, rather than about the design flaws that might cause them to ignite. Unfortunately, today’s debates about banking reform have just this character. Reversing the robotic gigantism of banking ought to be the top […]
History repeating itself: From the Argentine default to the Greek tragedy?
Alcidi, Cinzia, Giovannini, Alessandro & Gros, Daniel. Since the onset of the debt crisis in late 2009, the comparisons between Greece and Argentina have multiplied, with an emphasis more on the similarities than the differences. This is not surprising given the stunning parallels. This Commentary draws a systematic comparison between the two countries over the decade […]
Confessions of a Financial Deregulator
DeLong, Bradford. Back in the late 1990’s, in America at least, two schools of thought pushed for more financial deregulation – that is, for repealing the legal separation of investment banking from commercial banking, relaxing banks’ capital requirements, and encouraging more aggressive creation and use of derivatives. If deregulation looks like such a bad idea […]
The G20 and global imbalances
Eichengreen, Barry. Global imbalances remain a key issue for G20 leaders. This column evaluates the progress made by G20 leaders in the run up to their Cannes summit this November, concluding that the G20 process is unlikely to protect us from the risks posed by disorderly unwinding of imbalances. Global imbalances continue to place the […]
Does population ageing reduce productivity growth?
Gonzalez-Eiras, Martin & Niepelt, Dirk. Should developed countries raise their retirement ages to combat the economic effects of their ageing populations? This column presents a model suggesting that, viewed in isolation, putting off retirement will actually reduce growth. It is only when viewed along with other policies that the benefits for growth arise. The prospect of “greying” […]
Έπεσε έξω…
Το 1984, ο George Stigler προέβλεψε ότι σύντομα η οικονομική επιστήμη θα γινόταν η βασίλισσα των κοινωνικών επιστημών, χαρακτηρίζοντάς την μάλιστα και ως αυτοκρατορική επιστήμη. Από τότε, όμως, η εξέλιξη της οικονομικής επιστήμης μάλλον τον έχει διαψεύσει, καθώς, ολοένα και περισσότερο οι οικονομολόγοι συμβουλεύονται τα συγγράμματα άλλων κοινωνικών επιστημών, όπως της κοινωνιολογίας και της ψυχολογίας, […]
Fiscal policy in developing countries: Escape from procyclicality
Frankel, Jeffrey, Vegh, Carlos & Vuletin, Guillermo. With the ongoing financial turmoil in Europe, many emerging market countries are now deemed less risky than so-called “advanced” countries. This column examines why this is the case and finds that the cyclicality of a country’s fiscal policy – a sign of its riskiness – is inversely correlated with the […]
Chinese Finance Comes of Age
Davies, Howard. The Chinese financial system’s evolution in recent years has been extraordinary. I have observed its transformation as a member of the International Advisory Council of the China Banking Regulatory Commission (CBRC). Back in 2002, all of China’s major banks were awash in non-performing loans (NPLs), which in some cases amounted to more than […]
Mr Keynes and the moderns
Krugman, Paul. Keynes’ General Theory is 75 years old. In this column, Paul Krugman argues that many of its insights and lessons are still relevant today, but many have been forgotten. A broad swath of macroeconomists and policymakers are applying old fallacies to today’s crisis. As the nostrums being applied by the “pain caucus” are […]