The Eurozone crisis has raised doubts about the rationale which underpinned the creation of the single currency. Tal Sadeh writes that despite early difficulties in accurately quantifying the trade benefits brought about by the euro, recent research shows that it has more than doubled trade among its member states. Moreover, while the Eurozone crisis has created more substantial problems in Southern Europe, the trade benefits derived from the single currency have been disproportionately larger in Eurozone periphery states.
With all the above in mind, newly published research provides strong evidence that the euro indeed has more than doubled trade among its Member States. Chart 1 shows that the euro’s trade effect did not begin to kick in until 2001, but by 2006 it added up to more than 100 per cent among members of the Eurozone and more than 40 per cent between members of the Eurozone and non-members (whether members of the EU or not).
Tal Sadeh – Tel Aviv University
Tal Sadeh is Senior Lecturer at the Department of Political Science and Head of the Harold Hartog School of Government and Policy at Tel Aviv University. He is also Co-President of the Israeli Association for the Study of European Integration. His research interests include international political economy, the political economy of the EU (in particular the single currency and EU-Israeli relations) and international institutions and governance structures
The bimonthly WIPO Magazine (available in English, French and Spanish) shows intellectual property, creativity and innovation in action across the world, and highlights WIPO activities which support them.
Subscribe to receive the print edition (free of charge).
The World Intellectual Property Organization (WIPO) is one of the 17 specialized agencies of the United Nations. WIPO was created in 1967 "to encourage creative activity, to promote the protection of intellectual property throughout the world." WIPO currently has 186 member states, administers 26 international treaties, and is headquartered in Geneva, Switzerland...
The seminar series features economists from around the world, presenting their latest research to a policy-oriented audience. It seeks to stimulate an informed discourse on the effects of IP policies on economic performance.
Videos of the seminars and relevant background material are available on this webpage. The views expressed by the seminar speakers are personal and do not necessarily reflect those of WIPO...
Does your design already exist? Search over 30,000 industrial designs through the Hague Express Database: http://t.co/jkaZWOAR7z— WIPO (@WIPO) January 2, 2014
Via Cass Bschool alumna Frances Coppola
I am an economics professor at Oxford University, and a fellow of Merton College. This blog is written for both economists and non-economists.
PRESS RELEASE, 3 July 2013
EIB Prize for excellence in economic and social research awarded for the first time
The European Investment Bank (EIB) Prize, launched this year, is an award created by the EIB Institute to recognise and stimulate excellence in economic and social research, its implementation and diffusion. The first EIB Prizes are awarded to two candidates in recognition of their research on the topic of the prize: “Growth, employment and convergence, with applications to the European Union”. This year’s “Outstanding Contribution Award” will go to Prof. Dr Klaus F. Zimmermann from the University of Bonn and Director of the Institute for the Study of Labour (IZA). Prof. Dr Elias Papaioannou, from the London Business School, will receive the 2013 “Young Economist Prize”. Both laureates were honoured for their research that has led to a better understanding of the forces at work in Europe and of suitable policy prescriptions.
The EIB Prize will be presented by EIB President Werner Hoyer and Professor Christopher Pissarides, chair of the jury, during the award ceremony to be held in Warsaw on 19 September 2013.
For more information on the EIB Prize: http://institute.eib.org/programmes/knowledge-2/eib-prize/
Youtube, 9 May 2013
Sanjay G. Reddy, Associate Professor of Economics at The New York School for Social Research, discusses inequality and globalisation, the ethics of economics and how to determine growth.
Professor Reddy refers to the use of other economic indicators other than GDP (as Porter) and to the report of Commission on the Measurement of Economic Performance and Social Progress (www.stiglitz-sen-fitoussi.fr)
The Institute has partnered with pre-eminent international institutions aligned to its mission with a view to expanding its global community, enhancing dialogue, leveraging networks and creating synergies. In Asia, the Institute’s partners currently include:
Its global partners currently include:
The Institute is also in discussion with the London School of Economics and Political Science with the intention of entering into agreements for specific collaboration and partnerships.
Johnson Graduate School of Management at Cornell University
Academic Council of Fung Global Institute
Click here for videos: new.livestream.com/kauffmanfoundation/ebf2013
Click here for "Economy Top 500 influencers" altwire.utne.com/rt_influencer/economics_v3/network
+TWITTER TOP ECONOMIC INFLUENCERS AT THE 2013 KAUFFMAN FOUNDATION ECONOMIC WEBLOGGERS' FORUM (Via Brad Delong)
Friday, April 12: Kauffman Foundation Conference Center – Kansas City Room
Welcome by Brad Delong, Professor of Economics U.C. Berkeley and weblogger at "Grasping Reality with Both Invisible Hands"
Keynote – Economic and Financial Weblogging and the Future
Panel discussion – Economic and Financial Weblogging, and New Modes and Orders in Education
Panel discussion – Economic and Financial Weblogging and the Future and Sustainability of Financial Journalism (Panel: Cardiff Garcia, Joe Weisenthal, Allison Schrager; Moderator: George Kahn)
Panel discussion – Economic and Financial Weblogging and the Future and Sustainability of Mainstream Journalism
Panel discussion – Economic and Financial Weblogging, Thinktanks and Policy Advocacy, and the Public Sphere (Panel: Stan Collender; Dane Stangler; Sarah Kliff; Moderator: Corey Dillon)
Panel discussion – Economic and Financial Weblogging and Standard Ivy-Covered Academia
Raj Chetty, a Harvard University economist working on taxation, social insurance and education policy, won the John Bates Clark young economist award, the American Economic Association said in a statement today.
“Raj Chetty is a remarkably productive economist whose contributions assimilate evidence using a variety of methodological perspectives to shed new light on important public policy questions,” the AEA said in a statement on its website. “He has established himself in a few short years as arguably the best applied microeconomist of his generation.”...
Justin Fox is editorial director of the Harvard Business Review Group and author of The Myth of the Rational Market: A History of Risk, Reward, and Delusion on Wall Street.
"By almost any market test, economics is the premier social science," Stanford University economist Edward Lazear wrote just over a decade ago. "The field attracts the most students, enjoys the attention of policy-makers and journalists, and gains notice, both positive and negative, from other scientists."
Triumphalism like that calls for a comeuppance, of course. So, as the nation's (and a lot of the world's) economists gather this weekend in San Diego for their annual hoedown, it's worth asking: Are there any signs that the imperialist era of economics might finally be coming to an end?...
"[A] masterpiece". (Martin Wolf Financial Times )
"[E]ssential reading . . . both for its originality and for the sobering patterns of financial behaviour it reveals."--Economist
"[A] terrific book."--Andrew Ross Sorkin, New York Times
"[T]he most comprehensive study of financial crises and their aftermath . . ."--Eduardo Porter, New York Times
"Everyone working on economic policy should own This Time is Different and open it for a bracing blast of sobriety when things seem to be going well."--Greg Ip, Washington Post
Eclipse: Living in the Shadow of China's Economic Dominance (Amazon)
Arvind Subramanian, ISBN paper 978-0-88132-606-2, September 2011, 216 pp. $21.95
WASHINGTON—The Peterson Institute for International Economics is pleased to announce that Eclipse: Living in the Shadow of China's Economic Dominance (2011), by Arvind Subramanian, has been named one of the three Best Books of 2012 by China Business News. Subramanian, a senior fellow at the Institute and at the Center for Global Development, shares this year's Best Book honor with Henry Kissinger for his book, On China, and with Zhou Xiaochuan, the governor of the Central Bank of China, for his book, The Global Financial Crisis: Observations, Analysis and Countermeasures. The award was presented during China Business News's annual conference in Beijing on November 24.Eclipse was published by the Peterson Institute and has been translated into Chinese, Japanese, and Spanish (forthcoming). There are more than 100,000 copies in print worldwide.
"We are extremely proud that Arvind's book has been recognized with this award for its important discussion of China's ascendance as an economic power," said C. Fred Bergsten, director of the Peterson Institute. "The award demonstrates that Arvind's historical and political analysis is spurring debate and discussion throughout the world, not just in the United States. He is in very good company with Dr. Kissinger and Governor Zhou!"
In the book Subramanian argues that China's global economic dominance is likely to be more imminent, broader in scope, and larger in magnitude than is generally believed. He explains this dominance as a product of historical forces, economic policies and objectives put forward by China, and argues that the United States cannot do much to alter the trend. This conclusion challenges a widely held view that the right set of economic policies can retain the United States' position as the most economically powerful nation in the world.
China Business News, one of China's leading daily newspapers, is based in Shanghai. The award selection was made by a jury of influential Chinese academics, international economists, and finance executives. The other contenders for Best Book honors included Daniel Yergin's, The Quest: Energy, Security and the Remaking of the Modern World , Robert Shiller's Finance and the Good Society, former World Bank chief economist Justin Lin's The Quest for Prosperity: How Developing Countries Can Take Off, and Nobel Prize winning economist Michael Spence's The Next Convergence: The Future of Economic Growth in a Multi-Speed World.
>> Download news release [pdf]
Arvind Subramanian is senior fellow jointly at the Peterson Institute for International Economics and the Center for Global Development. He is also coauthor of Who Needs to Open the Capital Account? (2012) and of a forthcoming book (with Aaditya Mattoo) Greenprint: A New Approach to Climate Change Cooperation. Foreign Policy magazine named him as one of the world’s top 100 global thinkers in 2011.
About the Peterson institute
The Peterson Institute for International Economics is a private, nonprofit, nonpartisan research institution devoted to the study of international economic policy. Since 1981 the Institute has provided timely and objective analysis of, and concrete solutions to, a wide range of international economic problems. Support is provided by a wide range of chari- table foundations, private corporations and individual donors, and from earnings on the Institute’s publications and capital fund.
The Open Knowledge Foundation (okfn.org) is dedicated to promoting the creation, sharing and application of Open Knowledge in the Digital Age.
blog.okfn.org, December 17, 2012, First Open Economics International Workshop
On 17-18 December, economics and law professors, data publishers, practitioners and representatives from international institutions will gather at Emmanuel College, Cambridge for the First Open Economics International Workshop. From showcasing the examples of successes in collaborative economic research and open data to reviewing the legal cultural and other barriers to information sharing, this event aims to build an understanding of the value of open data and open tools for the economics profession and the obstacles to opening up information in economics. The workshop will also explore the role of greater openness in broadening understanding of and engagement with economics among the wider community including policy-makers and society.
This event is part of the Open Economics project, funded by the Alfred P. Sloan Foundation and is a key step in identifying best practice as well as legal, regulatory and technical barriers and opportunities for open economic data. A statement on the Open Economics Principles will be produced as a result of the workshop...
The event is being organized by the Centre for Intellectual Property and Information Law (CIPIL) at the University of Cambridge and Open Economics Working Group of the Open Knowledge Foundation and is funded by the Alfred P. Sloan Foundation. More information about the Working Group can be found online.
Climate Change Strategies (Including Mangroves), December 4, 2012
Banking Competition, Housing Prices and Macroeconomic Stability (with Oscar Arce). The Economic Journal, (forthcoming, 2012)
Job Creation in Spain: Productivity Growth, Labour Market Reforms or both? (with J. Boscá, R. Doménech and J. Ferri). Chapter 3 in The Spanish Economy: A General Equilibrium Perspective. Boscá, J. E., Doménech, R., Ferri, J., y J. Varela (Eds.). Palgrave MacMillan (Londres, 2011).
Household Leverage and Fiscal Multipliers (with J. Boscá and J. Ferri) Banco de España, Documento de Trabajo 1215. 2012Price Rigidity and the Volatility of Vacancies and Unemployment (with R. Doménech and J. Ferri). New draft, 2011.
Labour Markets in the Euro Crisis, September 2012
The latest CESifo DICE Report (2/2012) focuses on how the European labour markets in Estonia, France, Germany, Ireland, Italy, the Netherlands and Spain have fared in the euro crisis. While Germany and the Netherlands have come through the crisis relatively well, the labour market situation in Estonia, Ireland and Spain has deteriorated considerably. France and Italy fall between these two poles.
Mr. Philippe Askenazy, new member (announced 13 Nov, 2012) of French Prime Minister's economic advisory team (Employment specialist in Conseil d'analyse économique (CAE)), www.jourdan.ens.fr/~askenazy/
Alvin E. "Al" Roth (born December 19, 1951) is an American economist currently serving as the George Gund Professor of Economics and Business Administration at Harvard Business School. Roth has made significant contributions to the fields of game theory, market design and experimental economics. In 2012, he won the Nobel Memorial Prize in Economic Sciences jointly with Lloyd Shapley...
The 2012 A.T. Kearney Foreign Direct Investment Confidence Index finds that while FDI flows have picked up slightly in the past two years, this modest optimism could quickly revert to retrenchment.
It's little surprise, considering the economic turbulence in the developed world, that emerging markets fare well in the rankings. China, India, and Brazil take the top three positions, and Southeast Asia, with its large and growing consumer base, makes a strong showing: Indonesia, Malaysia, Singapore, Thailand, and Vietnam all hold high rankings. South Africa, which was unranked in 2010, rebounds to 11th place, while Russia and Turkey make large gains, especially in comparison to neighboring countries in Europe (see figure 1).
Conclusion of "Farms Here, Forests there"
Conserving tropical rainforests generates significant financial gains and savings for the U.S. agriculture and timber industries, while also increasing opportunities for residents of rainforest nations.
What is the Scorecard?
The Palm Oil Buyers’ Scorecard 2011 measures the
performance of 132 major retailers and consumer goods manufacturers
against 4 areas which show whether these companies are acting
The Scorecard focuses on European companies, since they are leading the way in transforming the market for palm oil, and were the first to commit to the Roundtable on Sustainable Palm Oil (RSPO). However, it also looks at other markets such as Australia and Japan where some progress is being made.
Research from Melbourne Business School (MBS) has found that if a product clearly reflects factors which impact ethical consumerism on its label, consumers will favour that product over others.
As a result of her research in this area, MBS Professor Jill Klein is calling for manufacturers to improve their labeling to provide consumers with a more informed choice and to increase sales.
Professor Klein based her research on a series of experiments performed at the Melbourne Zoo between April and June last year. Zoo visitors were asked to select between a food product that did not contain the orangutan-unfriendly palm oil and a virtually equivalent alternative that contained vegetable oil...
A new report comes up with a better way to size up wealth
... Gauging an economy by its GDP is like judging a company by its quarterly profits, without ever peeking at its balance-sheet. Happily, the United Nations this month published balance-sheets for 20 nations in a report overseen by Sir Partha Dasgupta of Cambridge University. They included three kinds of asset: “manufactured”, or physical, capital (machinery, buildings, infrastructure and so on); human capital (the population’s education and skills); and natural capital (including land, forests, fossil fuels and minerals).
...Human capital represents 88% of Britain’s wealth and 75% of America’s. The average Japanese has more human capital than anyone else...
...In 14 of the 20 countries studied, these increases in wealth outpaced the growth of their population, leaving per-person wealth higher in 2008 than in 1990. Germany, for example, increased its human capital by over 50%. China expanded its “manufactured” capital by an extraordinary 540%.
... Now that economists have shown that such wealth can be measured, they must decide what it should be called. In his earlier academic work Sir Partha calls it “comprehensive wealth”. The UN report dubs it “inclusive wealth”
The S&P/Case-Shiller Home Price Indices are the leading measures for the US residential housing market, tracking changes in the value of residential real estate both nationally as well as in 20 metropolitan regions
...In the 1971 book “The Logic of Collective Action: Public Goods and the Theory of Groups,” the economist Mancur Olson argued that collective action problems are pervasive, plaguing nations and economic groups alike. “Most groups cannot provide themselves with optimal amounts of a collective good,” he said, because they cannot manage a “selective incentive” or arrange “coercion or some reward.”...
...If such mortgage principal reductions could be applied on a large scale, there could be large neighborhood effects, raising a sense of optimism among homeowners and bolstering the value of all homes and, ultimately, the whole economy. But mortgage lenders in all their different forms lack a group strategy...
Whether the Greek elections this weekend trigger the Eurozone’s first exit or not, the possibility of exit is now firmly on the table. But where are the plans for this highly complex operation that could, if mishandled, cause untold economic damage in Europe and beyond? This column, by a Wolfson Prize finalist (Catherine Dobbs) and a Nobel Laureate (Michael Spence, Emeritus Dean Stanford Graduate School of Business), sketches the core elements of one such plan.
15 June 2012,"Preventing a Eurozone bank and bond run"
...But what outside analysts often ignore is that this bleak scenario hides some impressive successes. Spain entered the crisis with one of the lowest public debt figures in the eurozone and still has a smaller debt/GDP ratio than Germany despite its rapid rise.
Spain's conservative, diversified commercial banks have not yet needed a major bailout, and they have spent four years provisioning against the eventual collapse of real estate prices. The chronic current-account deficit has fallen by half, and export growth is strong. Unit labor costs have declined steadily for two years.
Spain last year handed a huge electoral win to a government that promised only austerity and unpopular reforms, hence voting for austerity rather than against it. In February, the government unveiled a reform of the rigid labor market which was the most radical in postwar Europe, and the only public response was a call for a general strike that met with a tepid response. Spain's indignados, who were actually the precursors of the Occupy movement, have continued a peaceful and dwindling protest over the crisis, without concrete proposals.
There is still no violence in the streets, no calls to leave the euro or repudiate the debt, no government defiance of eurozone demands. It would be difficult to find a more model patient for the bitter medicine being administered by eurozone leaders.
So why are markets continuing to drive up Spain´s risk premium? Foreign analysts appear to toss Spain into the Greece "bag" for two reasons: either they overlook...
"This is an intellectually rich book that develops an important thesis with verve. It should be widely read", Review by Martin Wolf (Financial Times)
Kindle - 546 pages, Crown Business (March 20, 2012)
(Daron Acemoglu will be delivering a conference at the BBVA Foundation in Madrid, Spain on May 21, 2012. Click here for more information, PDF.)
Trumanfactor, “Prosperity is all about political institutions and politics – Daron Acemoglu”, 30/04/2012. (This interview is also available in Spanish)
In 2005 he received the John Bates Clark Medal awarded to economists under forty judged to have made the most significant contribution to economic thought and knowledge. In 2010 Foreign Policy listed him as one of the top 100 global thinkers.
..."The same applies to Greece and Spain. Fix politics, improve institutions, undertake structural reforms that encourage investment and innovation and create a level playing field for the population at large, and the Greek and Spanish people will be as hard-working and as innovative as Northern Europeans"...
www.doingbusiness.org/rankings (2012 is the 9th publication)
Argentina is 113th in the world and Spain 44th.
After the expropriation of YPF from Repsol by the Argentinian government, and if the same criteria are used for the analysis in the report of 2013 as those of 2012, Argentina will worsen its position in the table at the end of this year when the data of Doing Business 2013 will be published, which will be updated or conducted with data of the 1st June 2012.
"Doing Business in a More Transparent World" (2012) (doingbusiness.org/reports)
...Nine years of Doing Business data, together with other data sets, have enabled a growing body of research on how specific areas of business regulation—and regulatory reforms in those areas—relate to social and economic outcomes. Some 873 articles have been published in peer-reviewed academic journals, and about 2,332 working papers are available through Google Scholar...
...Over the past 9 years more than 12,000 professionals in 183 economies have assisted in providing the data that inform the Doing Business indicators...
...In addition, the World Bank Group has been working with a consultative group—including labor lawyers, employer and employee representatives, and experts from civil society, the private sector, the (United Nations) International Labour Organization (ILO) and the OECD— to review the methodology and explore future areas of research...
Moving from the worst one-fourth of nations to the best one-fourth implies a 2.3 percentage point increase in annual growth.)
...Gayle Allard, a professor of managerial economics from Spain's IE Business School, has this analogy.
"You have the Greek model, or the Irish model," she said. "You can either go kicking or screaming, or you can bite the bullet, like people have done in Ireland."...
Some countries, like the UK can decide whether they do tough austerity or not. But Spain doesn't have that choice," she said.
A collaboration between Harvard and MIT:
Press "Play" once inside Explore Interactive Visualizations
|"'Complexity' Predicts Nations' Future Growth,"
The Wall Street Journal, October 26, 2011
|"Is ‘complexity’ the key to economic growth?"
The Washington Post, October 26, 2011.
The Economist, October 27, 2011.
|"Harvard economist warns about world economy,"
ABC News (Australia), October 27,2011.
For fifty years, the UCLA Anderson Forecast has provided forecasts for the economies of California and the United States. Founded by professor Robert M. Williams in 1952, the national forecast has been recognized as one of the most accurate, and has a reputation for being unbiased – a factor that the numerous corporate and Wall Street forecasts cannot lay claim to...
Established in 1978 The Group of Thirty is a private, nonprofit, international body composed of very senior representatives of the private and public sectors and academia.
The Group of Thirty aims to deepen understanding of international economic and financial issues, to explore the international repercussions of decisions taken in the public and private sectors, and to examine the choices available to market practitioners and policymakers.
The 2008 Financial Crisis and Its Aftermath: Addressing the Next Debt Challenge (PDF download, 143 pages)
Thomas A. Russo, Aaron J. Katzel (2011), (Economic Policy, Debt, Banking).
This paper examines the recent developments in the 2008 Financial Crisis, including the causes, responses, and the future outlook for the United States.
August 18, 2011 Jeffrey Sachs, Financial Times.
..The path to recovery now lies not in a new housing bubble, but in upgraded skills, increased exports and public investments in infrastructure and low-carbon energy. Instead, the US and Europe have veered between dead-end, consumption-oriented stimulus packages and austerity without a vision for investment...
Jeffrey D. Sachs is the Director of The Earth Institute, Quetelet Professor of Sustainable Development, and Professor of Health Policy and Management at Columbia University. He is also Special Advisor to United Nations Secretary-General Ban Ki-moon...
"Nobody knows what is going to happen next," says Nicholas Bloom. One thing is sure: "When people are uncertain about the future they wait and do nothing" – and that will lead to recession.
'What is tax reform?"
That's the Jeopardy-like question matching the answer: "The best step the government could take now to promote growth and employment." The Obama administration has been responding with "What are higher marginal tax rates and more stimulus?" But fundamental tax reform offers three key benefits.
First, reducing marginal tax rates on saving and investment and on work and entrepreneurship will increase capital formation and productivity, raising wages and output. Broadening the tax base and sharply lowering marginal tax rates can raise gross-domestic-product growth by a half to a full percentage point per year over a decade, according ...
Research-based policy analysis and commentary from leading economists
"Editors' choice" tab
11 August 2011
Investors are anticipating the unravelling of the 21 July 2011 “solution” and a breakdown of the interbank-market that would throw the economy into an “immediate recession” like the one experienced after the Lehman bankruptcy. This column argues that this will happen without quick and bold action...
At this point the Eurozone needs a massive infusion of liquidity. Given that the cascade structure of the EFSF is part of the problem, the solution cannot be a massive increase in its size. However, the EFSF could simply be registered as a bank and could then have access to unlimited re-financing by the ECB, which is the only institution which can provide the required liquidity quickly and in convincing quantity.
This solution would have the advantage that it leaves the management of public debt problems in the hand of the finance ministries, but it provides them with the liquidity backstop that is needed when there is a generalised breakdown of confidence and liquidity. This is exactly when a lender of last resort is most needed.
It would of course be much better if the ECB did not have to ‘bail out’ the European rescue mechanism, but in this case one has to choose between two evils. Even a massive increase in the ECB’s balance sheet (which if the US experience is any guide will not lead to inflation) constitutes a lesser evil compared to a breakdown of the Eurozone financial system.
Editor’s Note: Daniel Gros expands on his thoughts in a companion audio piece, the Vox Talks The Eurozone crisis: only the unlimited firepower of the ECB will stop market panic
Daniel Gros is the Director of the Centre for European Policy Studies (CEPS) in Brussels. Originally from Germany, he attended university in Italy, where he obtained a Laurea in Economia e Commercio. He also studied in the United States, where he earned his M.A. and PhD (University of Chicago, 1984). He worked at the International Monetary Fund, in the European and Research Departments (1983-1986), then as an Economic Advisor to the Directorate General II of the European Commission (1988-1990). He has taught at the European College (Natolin) as well as at various universities across Europe, including the Catholic University of Leuven, the University of Frankfurt, the University of Basel, Bocconi University, the Kiel Institute of World Studies and the Central European University in Prague.
JUDY WOODRUFF: Today's plunge marked the fourth time in just over a week where the Dow Jones industrials have dropped by triple digits. Market volatility is at again near record levels.
We look at this and the larger picture with two people who have worked closely on economic policy. Christina Romer was the chair of the Council of Economic Advisers for President Obama until September 2010. She's a professor of economics at the University of California at Berkeley. And Matthew Slaughter served on President George W. Bush's Council of Economic Advisers from 2005 to 2007. He's now associate dean of the Tuck School of Business at Dartmouth College. And we thank you both for being with us.
Christina Romer, to you first.
The scary roller-coaster ride on the stock market continued again today. How do you explain it?
CHRISTINA ROMER, University of California at Berkley: Well, I think, obviously, one of the things about the stock market is it's very hard to explain the ups and downs...
From the perspective of Michael Spence, a Nobel Prize-winning economist (2001) and Hoover Institution fellow, the president faces some tough sledding..
...It's a structural reality that Spence believes Washington hasn't fully grasped and doesn't have a plan in place to address. "It's a design challenge, and that's not what we're doing right now," he said..
"There is every reason to believe these trends will continue," according to Spence, also a professor of economics at New York University's Stern School of Business..
Distinguished Visiting Fellow at the Council on Foreign Relations and the author of The Next Convergence: The Future of Economic Growth in a Multispeed World (May 2011, www.thenextconvergence.com).
Beshears and Katherine L. Milkman of the Wharton School at the University of Pennsylvania looked at how so-called "escalation bias" affects analysts' forecasts. Their paper, "Do Sell-Side Stock Analysts Exhibit Escalation of Commitment?" (PDF, 39 pages) was published in March by the Journal of Economic Behavior and Organization.
Beshears and Milkman studied the Institutional Brokers' Estimate System I/B/E/S database with more than 6,200 analysts' quarterly forecasts on about 3,500 companies over more than 18 years, from 1990 to 2008.
Among their specific findings:
Francis E. Warnock, Adjunct Senior Fellow for International Finance
Paul M. Hammaker associate professor of business administration at the Darden Business School, University of Virginia. Former senior economist at the Board of Governors of the Federal Reserve System. Author of the Center for Geoeconomics reports How Dangerous Is U.S. Government Debt?, Two Myths About the U.S. Dollar, and Doubts About Capital Controls.
The writer is chairman of Roubini Global Economics, professor at the Stern School, NYU and co-author of Crisis Economics.
Economics team at Goldman Sachs now say: "We now see a one-in-three risk of renewed recession".
...In the meantime, US politicians might have done just about enough to convince debt markets that America’s credit is still good. For that, Americans – and others around the world – should stop pillorying them and give them their due credit.
Raghuram Rajan, a former chief economist of the IMF, is Professor of Finance at the University of Chicago’s Booth School of Business and author of Fault Lines: How Hidden Fractures Still Threaten the World Economy, the Financial Times Business Book of the Year.