nep-pke 2013-08-23 papers

on Post Keynesian Economics

Issue of 2013‒08‒23
three papers chosen by
Karl Petrick
Western New England University

World economy, economics and economic policy: what emerges after the crisis? By Sherstnev, Mikhail
Large global volatility shocks, equity markets and globalisation: 1885-2011 By Mehl, Arnaud
Written evidence given by Professor Alexander Pepper of the London School of Economics and Political Science to the UK Parliamentary Commission on banking standards. By Pepper, Alexander

World economy, economics and economic policy: what emerges after the crisis?

By:	Sherstnev, Mikhail
Abstract:	The paper analyzes the current discussions on the state of economics with special focus on the interrelationships between key ideas of economic theories and real actions of economic policy in the course of the global economic crisis. The global economic crisis showed the limited ability of mainstream in economics to service the economic practice, and, therefore, the attention of researchers and economic policy-makers was drawn again to some alternative views in economics.
Keywords:	Economics, economic crisis, economic policy.
JEL:	A11 E6
Date:	2013–08–11
URL:	http://d.repec.org/n?u=RePEc:pra:mprapa:49019&r=pke

Large global volatility shocks, equity markets and globalisation: 1885-2011

By:	Mehl, Arnaud
Abstract:	I estimate the transmission of large global volatility shocks in international equity markets from the earlier (pre-1914) to the modern era of globalisation. To that end, I identify 43 such shocks over the period 1885-2011, defined as significant increases in unanticipated volatility in US equity markets, which I relate to well-known historical events. My estimates suggest that the response of global equity markets to these shocks in a panel of 16 countries is both statistically significant and large economically. On average, global equity market valuations correct by about 20% in the month when a shock occurs. There is substantial heterogeneity in responses both across countries and time, however, which can be partly explained by differences in global trade integration. I find no evidence that other potential theoretical determinants, such as output composition, country fundamentals or global policy responses matter, by contrast. These results shed light on a neglected aspect of globalisation, which creates opportunities but also heightens the exposure of economies to acute surges in global uncertainty and risk aversion. JEL Classification: F30, F31, N20
Keywords:	equity markets, Globalisation, international linkages, large global volatility shocks
Date:	2013–05
URL:	http://d.repec.org/n?u=RePEc:ecb:ecbwps:20131548&r=pke

Written evidence given by Professor Alexander Pepper of the London School of Economics and Political Science to the UK Parliamentary Commission on banking standards.

By:	Pepper, Alexander
Abstract:	My contention is that many of the current problems with 'Bankers’ Pay' have their origins in the dismantling of the formal and informal institutions which regulated the labour markets in the financial centres in London and New York prior to 1986-1987.
Date:	2013
URL:	http://d.repec.org/n?u=RePEc:ner:lselon:http://eprints.lse.ac.uk/51697/&r=pke

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