The Inequality Trap
Derviş, Kemal. As evidence mounts that income inequality is increasing in many parts of the world, the problem has received growing attention from academics and policymakers. In the United States, for example, the income share of the top 1% of the population has more than doubled since the late 1970’s, from about 8% of annual […]
Economics in the Crisis
Krugman, Paul. Update: Actually it was three degrees from three Universities. So I believe, taking into account the Free University of Berlin, this makes me Herr Senhor Professor Doktor Doktor Doutor Doutor Doutor. Πηγή: The New York Times πλήρες κείμενο
A tale of two depressions redux
Eichengreen, Barry, O’Rourke, Kevin. The debate over stimulus versus austerity continues unabated. This column shows that, while industrial production and trade recovered much more quickly than during the Great Depression, both series now appear to be slowing down. It suggests that, as St Augustine would have said had he been managing director of the IMF, there […]
Challenges for the euro area and implications for Latvia
Wolff, Guntram. This Policy Contribution reviews the major challenges faced by the euro area, and discusses recent initiatives and the way forward. Some implications are drawn out for Latvia’s euro accession, which is likely to be beneficial on balance. The euro area faces three major challenges: (1) high private and public debt in some of […]
Whose Interests Are Central Banks Looking After?
Mattich, Allen. Central banks have largely been acting in the interest of the 1%. Note, this isn’t to say that their primary intention has been to defend the interests of the very wealthiest. But that’s the way it worked out. Πηγή: The Wall Street Journal πλήρες κείμενο
Modern Monetary Theory, an unconventional take on economic strategy
Matthews, Dylan. About 11 years ago, James K. “Jamie” Galbraith recalls, hundreds of his fellow economists laughed at him. To his face. In the White House. It was April 2000, and Galbraith had been invited by President Bill Clinton to speak on a panel about the budget surplus. Galbraith was a logical choice. A public […]
Good and Bad Deficits
Skidelsky, Robert. “Deficits are always bad,” thunder fiscal hawks. Not so, replies strategic investment analyst H. Wood Brock in an interesting new book, The American Gridlock. A proper assessment, Brock argues, depends on the “composition and quality of total government spending.” Πηγή: Project Syndicate πλήρες κείμενο
Sovereign Risk, Fiscal Policy, and Macroeconomic Stability
Corsetti, Giancarlo, Kuester, Keith, Meier, André, Mueller, Gernot. This paper analyzes the impact of strained government finances on macroeconomic stability and the transmission of fiscal policy. Using a variant of the model by Curdia and Woodford (2009), we study a “sovereign risk channel” through which sovereign default risk raises funding costs in the private sector. […]
The renminbi’s prospects as a global reserve currency
Prasad, Eswar. Is China’s currency destined to become the dominant global reserve currency? This column argues that despite not yet having a flexible exchange rate or open capital account, China’s government is pursuing ‘liberalisation with Chinese characteristics’. It argues that the renminbi will become a reserve currency within the next decade, eroding but not displacing […]
The Public and Its Problems
Rajan, Raghuram. On a recent visit to Europe, I found economists, journalists, and business people thoroughly frustrated with their politicians. Why, they ask, can’t politicians see the abyss that yawns before them, and come together to resolve the euro crisis once and for all? Πηγή: Project Syndicate πλήρες κείμενο