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on Post Keynesian Economics |
| By: | Engelbert Stockhammer (Kingston University) |
| Abstract: | Neoliberalism has not given rise to a sustained profit-led growth process, but to a finance-dominated accumulation regime in which growth relies either on financial bubbles and rising household debt (‘debt-driven growth’) or on net exports (‘export-driven growth’). The financial crisis that began in the market for derivatives on the US subprime mortgage market has translated into the worst recession since the 1930s. In Europe the crisis has been amplified by an economic policy architecture (the Stability and Growth Pact) that aimed at restricting the role of fiscal policy and insulating monetary policy and central banks from national governments. The crisis has thus led to a sharp economic divergence between core and peripheral countries. Contrary to the situation in the (export-driven) Germanic core of Europe, the crisis is escalating in the (debt-driven) southern countries of Europe. The paper interprets the policy regime as the outcome of national elites’ attempt to use European integration as a means to constrain nation states. The result is a policy regime that has fatally weakened nation states as regards their fiscal and monetary capacities without creating a European state. |
| Keywords: | Euro crisis, neoliberalism, European economic policy, European integration, financial crisis, sovereign debt crisis |
| JEL: | E02 E12 E5 E6 F5 P16 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:pke:wpaper:pkwp1401&r=pke |
| By: | L. Randall Wray; Xinhua Liu |
| Abstract: | This paper examines the fiscal and monetary policy options available to China as a sovereign currency-issuing nation operating in a dollar standard world. We first summarize a number of issues facing China, including the possibility of slower growth, global imbalances, and a number of domestic imbalances. We then analyze current monetary and fiscal policy formation and examine some policy recommendations that have been advanced to deal with current areas of concern. We next outline the sovereign currency approach and use it to analyze those concerns. We conclude with policy recommendations consistent with the policy space open to China. |
| Keywords: | China; Policy Space; Fiscal and Monetary Policy; Sectoral Balances Approach; Minsky; Sovereign Currency; Modern Money Theory; Middle-Income Trap; Financial Instability |
| JEL: | E2 E5 E6 F4 G2 G3 H5 H6 H7 H63 H72 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_783&r=pke |
| By: | LAURENCE SEIDMAN (Department of Economics,University of Delaware) |
| Abstract: | A sobering lesson from the Great Recession is that widespread worry about government debt generates strong political resistance to enacting a fiscal stimulus large enough to overcome a severe recession. Fortunately there is a way to implement fiscal stimulus without increasing government debt. The purpose of this article is to explain the stimulus-without-debt plan, defend it, and urge Keynesian economists to advocate it in today’s weak recovery and in future recessions. Under the plan, in a severe recession, fiscal stimulus enacted by Congress should be accompanied by a “dual-mandate transfer” from the Federal Reserve to the U.S. Treasury of the same magnitude so that the Treasury does not have to borrow to finance the fiscal stimulus. This article contrasts this stimulus-without-debt plan with alternative stimulus plans. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:dlw:wpaper:14-01.&r=pke |
| By: | Messkoub, M. |
| Abstract: | This paper focuses on poverty in the MENA region and whether it can be alleviated by intergenerational support within and across households. Intergenerational relations are mediated through several institutions. The most prominent of these are households, state, civil society and market. Combinations of social arrangements, economic resources and cultural traditions govern these institutions. Whether or not family and households can provide the necessary supports for their poorer or disadvantaged members would crucially depend on household composition, its economic resources and its interaction with the institutions of state, civil society and market. This paper explores the trends in family formation and composition over time and household interaction with the above mentioned institutions through the labour market, or through various state and NGO driven welfare programmes. The above trends as well as migration impact the intergenerational support within families. This paper will argue for improved social support and regional integration in order to complement family resources as well as tackle some of the emerging issues in relation to population ageing and care economy in the region. |
| Keywords: | MENA, demographic transition, household composition, intergenerational support, care economy, gender and care, social policy |
| Date: | 2013–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:ems:euriss:50173&r=pke |
| By: | Lant Pritchett, Charles Kenny |
| Abstract: | The approach of 2015, the target date of the Millennium Development Goals, sets the stage for a global reengagement on the question of “what is development?” We argue that the post-2015 development framework for development should include Millennium Development Ideals which put into measurable form the high aspirations countries have for the well-being of their citizens. Standing alone, low bar targets like the existing Millennium Development Goals “define development down” and put at risk both domestic and global coalitions to support to an inclusive development agenda. Measuring development progress exclusively by low bar targets creates the illusion that specific targeted programs can be an adequate substitute for a broad national and global development agenda. |
| Keywords: | Millennium Development Goals, development |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:cgd:wpaper:338&r=pke |
| By: | Peter Edward, Andy Sumner |
| Abstract: | The interplay of between- and within-country inequality, the relative contribution of each to overall global inequality, and the implications this has for who benefits from recent global growth (and by how much), has become a significant avenue for economic research. However, drawing conclusions from the commonly used aggregate inequality indices such as the Gini and Theil makes it difficult to take a nuanced view of how global growth interacts with changing national and international inequality. In light of this we propose and justify an alternative approach based on four consumption “layers” identified by reference to the global consumption distribution.We consider how each layer of global society has fared since the end of the Cold War. |
| Keywords: | poverty, inequality, economic development |
| JEL: | D63 I32 |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:cgd:wpaper:341&r=pke |
| By: | LAURENCE SEIDMAN (Department of Economics,University of Delaware) |
| Abstract: | Medicare for seniors has been evolving for half a century and has performed very satisfactorily. Extending Medicare to cover everyone regardless of age would have several advantages. It would provide automatic coverage and portability for everyone regardless of employment, health status, income, marital status, or residential location. It would use single-payer bargaining power to reduce medical cost as a percent of GDP. It would eliminate the burden imposed by private health insurance premiums. It would eliminate health insurance distraction for business managers, entrepreneurs, and job seekers, thereby improving the productivity of the U.S. economy. It would remove that implicit tax on entrepreneurship and job mobility that is imposed by a system of employer-provided private health insurance, and thereby achieve a welfare gain equal to the magnitude of this deadweight loss. It would also remove the implicit tax on having a high expected medical cost that is imposed on individuals by a system of individually-purchased private insurance, and thereby achieve what many citizens would judge to be an improvement in the equity. Medicare for All, however, would require a significant increase in taxes as a percent of GDP (roughly 8 percent of GDP—from 30 percent to 38 percent of GDP) to replace the elimination of private insurance premiums, and this tax increase would impose some efficiency cost on the economy. Moreover, Medicare for All might have harmful effects on medical care if the government uses its payer bargaining power to force down medical prices severely rather than moderately or if public tax resistance reduces earmarked revenue for medical care (as a percent of GDP) severely rather than moderately. Thus, if Medicare for All is adopted, it would be important to finance it with taxes that have moderate rather than severe efficiency costs, and to raise sufficient taxes so Medicare can pay prices that are high enough to avoid waiting lists and achieve high quality. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:dlw:wpaper:14-02.&r=pke |
| By: | Yellen, Janet L. (Board of Governors of the Federal Reserve System (U.S.)) |
| Date: | 2013–02–11 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgsq:630&r=pke |
| By: | Nicholas Stern |
| Abstract: | This paper examines a broad range of ethical perspectives and principles relevant to the analysis of issues raised by the science of climate change and explores their implications. A second and companion paper extends this analysis to the contribution of ethics, economics and politics in understanding policy towards climate change. These tasks must start with the science which tells us that this is a problem of risk management on an immense scale. Risks on this scale take us far outside the familiar policy questions and standard, largely marginal, techniques commonly used by economists; this is a subject that requires the full breadth and depth of what economics has to offer and a much more thoughtful view of ethics than economists usually bring to bear. Different philosophical approaches bring different perspectives on understanding and policy, yet they generally point to the case for strong action to manage climate change. |
| Date: | 2013–10 |
| URL: | http://d.repec.org/n?u=RePEc:lsg:lsgwps:wp84a&r=pke |
| By: | Nicholas Stern |
| Abstract: | Both intergenerational and intratemporal equity are central to the examination of policy towards climate change. However, many discussions of intergenerational issues have been marred by serious analytical errors, particularly in applying standard approaches to discounting; the errors arise, in part, from paying insufficient attention to the magnitude of potential damages, and in part from overlooking problems with market information. Some of the philosophical concepts and principles of Paper 1 are applied to the analytics and ethics of pure-time discounting and infinite-horizon models, providing helpful insights into orderings of welfare streams and obligations towards future generations. Such principles give little support for the idea of discrimination by date of birth. Intratemporal issues are central to problematic and slow-moving international discussions and are the second focus of this paper. A way forward is to cast the policy issues and analyses in a way that keeps equity issues central and embeds them in the challenge of fostering the dynamic transition to the low-carbon economy in both developed and developing countries. This avoids the trap of seeing issues primarily in terms of burden-sharing and zero-sum games – that leads to inaction and the most inequitable outcome of all. |
| Date: | 2013–10 |
| URL: | http://d.repec.org/n?u=RePEc:lsg:lsgwps:wp84b&r=pke |
| By: | Lo, Alex |
| Abstract: | Methodological pluralism advocates balanced consideration of multiple research methods. The concept rests upon the necessity of choice in the absence of conclusive principles to guide the preference of method. Ecological economics, however, appears to be engaging in a different conception creating confusion as to the scope for intellectual openness. This paper offers clarifications for this concept and a critique. Ecological economics advances a coherent theory crafted along its biophysical worldview and moral commitments. These imperatives guide the choice of method and favour a reduced range of methodological possibilities to the exclusion of neoclassical economic options. If ecological economics is seen as an ideological opposite of neoclassical economics, it would need a selective methodological strategy rather than maintaining methodological diversity. Maintaining diversity may erode the basis of its heterodox criticisms by requiring openness to the orthodox alternatives. Ecological economics has shown difficulty in sustaining its long-standing pluralist commitments while increasingly seeking clear differentiation from its monolithic “enemy”. |
| Keywords: | Methodological pluralism; methodological diversity; value pluralism; ecological economics; neoclassical economics. |
| JEL: | B40 Q57 |
| Date: | 2014–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:49543&r=pke |
| By: | Dandume, Muhammad Yusuf; A.C., Dr.Malarvizhi |
| Abstract: | This paper examines the linkage among financial liberalization, economic growth and poverty reduction in Sub-Saharan African countries (SSA). The study applies the recent panel Co-integration and vector error correction mechanism to address the heterogeneity and cross-border interdependence over the period of 1980 to 2010. The results reveal that economic growth is positively associated with poverty reduction and financial liberalization coefficients are positively related to economic growth. It implies that financial liberalization causes economic growth. However, the coefficients of financial liberalization are not significant in the poverty equation suggests that financial liberalization does not have direct impact on poverty reduction in the six Sub-Saharan African countries. This implies that the financial liberalization effects of poverty are upon contingent on the distributional changes introduced by the growth and the configuration of institutions and policies that supported the liberalization process and particularly, the existence or otherwise of good governance. |
| Keywords: | Liberalization, poverty, economic growth, financial repression |
| JEL: | G0 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:52349&r=pke |
| By: | G. Cornelis van Kooten |
| Abstract: | The government of British Columbia imposes restrictions on the export of logs from public and private forestlands, primarily to promote local processing and associated employment benefits. Economists wholeheartedly oppose BC’s export restrictions, arguing that BC’s citizens are worse off as a result of the government’s measures. In this paper, it is shown that, while free trade in logs might well maximize global wellbeing, it might not necessarily result in the greatest benefit to British Columbia. Indeed, both economic theory and a follow-up numerical analysis indicate that some restrictions on the export of logs can lead to higher welfare for BC than free trade. |
| Keywords: | international trade; log exports; forest industry; quota rents |
| JEL: | F13 F14 Q23 Q27 Q28 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:rep:wpaper:2014-01&r=pke |