News & Commentary:

Articles/Commentary

The new world order, 2017
Robert J. Samuelson (WP) Jan 1, 2017
The international order is in a state of flux, and that could prove chaotic.

My 2017 Prediction? Nothing Will Change.
Satyajit Das (Bloomberg View) Jan 1, 2017
Don't underestimate the power of the status quo.

Labor and Capital in the Global Economy
Kimberly Clausing (Democracy) Jan 1, 2017
How three decades of technological change, globalization, and policy made workers more at the mercy of capital.

Disunited Kingdom
Henry Farrell (Democracy) Jan 1, 2017
Brexit and the rise of the far-right are the conclusion of a decades-long weakening of European political parties.

It's Still Not the Supply Side
Mike Konczal & Marshall Steinbaum (Democracy) Jan 1, 2017
Yes, workers should be able to move and work freely. But economics remains fundamentally about power.

Are We Safe Yet?
Timothy F. Geithner (FA) Jan 1, 2017
How to manage financial crises.

A daunting new year dawns in global markets
FT View Jan 2, 2017
After a placid 2016, policymakers will struggle to keep the balance.

Markets outlook: the big issues facing investors in 2017
FT Reporters Jan 2, 2017
The full repercussions of the Trump win and Opec deal will be felt in the new year.

You can only turn back the clock on liberalism so far
Janan Ganesh (FT) Jan 2, 2017
Doomsters pay too much heed to those who look back in anger.

India takes stock after first phase of cash crunch
Kiran Stacey (FT) Jan 2, 2017
Experts divided on success of Modi’s unprecedented demonetisation experiment.

Surge in Chinese corporate investment into the US
Shawn Donnan (FT) Jan 2, 2017
Record FDI of $45.6bn in 2016 unlikely to be matched this year as Trump era looms.

Sir Tony Atkinson, economist and campaigner, 1944-2017
Chris Giles and Sarah O'Connor (FT) Jan 2, 2017
Labour party activist was a dominant force in the study of inequality.

Modi's Cash Ban Brings Pain, but Corruption-Weary India Grits Its Teeth
Geeta Anand (NYT) Jan 2, 2017
Even as poor Indians have struggled under a ban on the largest currency bills, many support the prime minister's efforts to combat a culture of corruption.

Do Central Bankers Know a Bubble When They See One?
Peter Schmidt (Mises Daily) Jan 2, 2017 More economic uncertainty hangs over China
Yiping Huang (EAF) Jan 2, 2017
The economic policy choices for China in the year ahead are extremely difficult. This is partly, of course, because of external uncertainties — a result of an unclear global economic outlook and a new US administration headed by President-elect Trump. The domestic policy options are also narrowing as the country faces the so-called 'risky trinity' — declining productivity, rising leverage ratios and narrowing policy flexibility — that require the navigation of big financial and structural reforms.

Automation Trepidation
Bloomberg View Jan 2, 2017
Robots will be great. Except for the workers they displace.

Are Chinese Enterprises Being Taxed to Death?
Zhang Jun (Project Syndicate) Jan 2, 2017
The move by the Chinese firm Fuyao Glass Industry Group to establish a manufacturing branch in the US has added more fuel to a long-running debate about the tax burden on the country's enterprises. Is the situation really as bad as entrepreneurs and investors claim?

Charting Our AI Future
Luciano Floridi (Project Syndicate) Jan 2, 2017
New artificial-intelligence applications will not confirm scaremongers’ warnings or usher in a dystopian science-fiction scenario. But they will oblige us to reflect seriously on who we are, could be, and would like to become, while challenging the exalted status we have conferred on our species.

“America First” and Global Conflict Next
Nouriel Roubini (Project Syndicate) Jan 2, 2017
When America pursued “America first,” policies in the 1920s and 1930s, it brought on the Great Depression and helped sow the seeds of World War II. If US President-elect Donald Trump shifts US geopolitical strategy similarly toward isolationism and unilateralism, there is little reason to expect a better outcome.

The Abandonment of Progress
Jean Pisani-Ferry (Project Syndicate) Jan 2, 2017
Many Western citizens have lost faith in progress: they no longer believe that the future will bring material improvement and that their children will have a better life than their own. They look backward because they are afraid to look ahead.

Why central bankers favour monetary policy inertia
Donato Masciandaro (VoxEU) Jan 2, 2017
The discussion of the delayed lift-off in US monetary policy is just the latest episode in a long-lasting debate over the causes of inertia in monetary policy. This column approaches the issue by assuming that psychological drivers can influence the decisions of central bankers. Loss aversion is one source of behavioural bias which can explain delays in changing the stance of monetary policy, including the fear of lift-off after a recession. The discussion of the delayed lift-off in US monetary policy is just the latest episode in a long-lasting debate over the causes of inertia in monetary policy. This column approaches the issue by assuming that psychological drivers can influence the decisions of central bankers. Loss aversion is one source of behavioural bias which can explain delays in changing the stance of monetary policy, including the fear of lift-off after a recession.

Headquarter separation and multi-plant operation
Toshihiro Okubo and Eiichi Tomiura (VoxEU) Jan 2, 2017
The core-periphery gap raises important questions for economic geography. Using Japanese data, this column examines firms’ decision to separate non-production activities from production plant facilities. Large plants, plants which intensively purchase materials, and plants located further from the core are more likely to have separate corporate headquarters, though the magnitude of this effect is small. Small-sized plants appear to be especially vulnerable to remoteness from urban cores. The core-periphery gap raises important questions for economic geography. Using Japanese data, this column examines firms’ decision to separate non-production activities from production plant facilities. Large plants, plants which intensively purchase materials, and plants located further from the core are more likely to have separate corporate headquarters, though the magnitude of this effect is small. Small-sized plants appear to be especially vulnerable to remoteness from urban cores.

Investors in Myanmar wait to reap the fruits of democracy
Jacopo Dettoni (FT) Jan 3, 2017
New government’s reforms hold promise but investors are on hold pending clarification.

The risks that threaten global growth
Martin Wolf (FT) Jan 3, 2017
An important possibility is that the economic engine is running out of steam.

Foreign fund managers struggle for China foothold
Gabriel Wildau and Jamie Smyth (FT) Jan 3, 2017
Curbs on capital outflows add to challenge for fund managers in the $1.3tn market.

Britain should beware consoling fantasies about China
James Richards (FT) Jan 3, 2017
More trade there will not replace business lost elsewhere.

Russia: Inside the private bank backed by the state
Max Seddon (FT) Jan 3, 2017
Using loans from the central bank, Otkritie doubled its assets overnight.

The Growing Threat of ‘Illiberal Democracy’
William A. Galston (WSJ) Jan 3, 2017
What happens when rule by the people conflicts with individual rights?

Brexit will create 400,000 jobs? This is a fiction, as any economist will tell you
Jonathan Portes (Guardian) Jan 3, 2017
Change Britain’s wild claim is either deeply ignorant or deliberately misleading. Brexit is not getting the serious debate it needs.

Will Latin America Regain Prosperity in 2017?
K@W Jan 3, 2017
Latin America's major nations are hoping that this will be the year that they finally recover from the lingering impact of weak commodity prices.

2017 will be a good year for banks
Brian Caplen (Banker) Jan 3, 2017
Interest rates are on the rise and there are economic benefits to populism. But for Chinese banks things may get a lot tougher.

The coming short-termism
Kemal Dervis (Brookings) Jan 3, 2017
The incoming Trump administration could usher in more short-term thinking to economic policymaking, an approach quite common among political leaders with purely private-sector background.

What will drive political uncertainty in 2017?
Guntram B. Wolff (Brugel) Jan 3, 2017
2017 promises to be another challenging year for Europe's liberal democracies. Many EU member states are facing elections. But it may be cultural backlash rather than economics that will drive populist vote.

Reforming US Corporate Taxes, the Right Way
Gary Clyde Hufbauer (PIIE) Jan 3, 2017
The election of Republican Donald Trump to the presidency, along with his party’s dominance of both chambers of Congress, provides a unique opportunity for the sort of comprehensive tax reform that could truly benefit the US economy.

A Bull Named Trump in a Shop Called China
Yasheng Huang (Project Syndicate) Jan 3, 2017
With US President-elect Donald Trump’s help, the “Chinese Century” may arrive sooner than anyone expected. By openly engaging with Taiwan, pointlessly pillorying China, and dismantling the Trans-Pacific Partnership, Trump is simultaneously provoking and empowering Asia's rising hegemon.

Trump’s Tax Plan and the Dollar
Emmanuel Farhi, Gita Gopinath and Oleg Itskhoki (Project Syndicate) Jan 3, 2017
US President-elect Donald Trump wants a "border-adjustment" tax as part of his corporate-tax reforms. But such measures are suitable only for countries that maintain a fixed exchange rate or are in a currency union; for countries with a floating exchange rate, currency appreciation will cancel out any competitiveness gains.

Rethinking Labor Mobility
Harold James (Project Syndicate) Jan 3, 2017
Humans are ingenious and adaptable, but only in some circumstances; so we must continue to search for viable opportunities that allow people to participate creatively and meaningfully in the economy. To that end, we should look to history, and study what happened to the “losers” during previous periods of rapid techno-globalization.

Donald Trump: Making the World Safe for Dictators
James Traub (FP) Jan 3, 2017
For 100 years, the United States has championed democracies around the world. President-elect Donald Trump is about to undo this pillar of American security and decency.

Unusual outcomes and uncertain times
Nicholas Kozeniauskas and Laura Veldkamp (VoxEU) Jan 3, 2017
Uncertainty shocks are a major avenue of research in the quest to explain business cycles, as well as asset prices and financial crises. This column argues that three conceptually distinct types of uncertainty that are often modelled independently – ‘macro’ uncertainty about an aggregate variable such as GDP, ‘micro’ uncertainty about firms’ individual outcomes, and ‘higher-order’ uncertainty that people have about the beliefs of others – are in fact related because all three are tied to disaster risk. Uncertainty shocks are a major avenue of research in the quest to explain business cycles, as well as asset prices and financial crises. This column argues that three conceptually distinct types of uncertainty that are often modelled independently – ‘macro’ uncertainty about an aggregate variable such as GDP, ‘micro’ uncertainty about firms’ individual outcomes, and ‘higher-order’ uncertainty that people have about the beliefs of others – are in fact related because all three are tied to disaster risk.

The protectionist trade fallacies of America First
FT VIew Jan 4, 2017
Donald Trump’s bullying of companies such as Ford is plain wrong.

Brexit experts, confess to your errors and carry on
Chris Giles (FT) Jan 4, 2017
Economists are absolutely justified in sticking to pre-referendum views on leaving EU.

The political price of Xi Jinping’s anti-corruption campaign
Jamil Anderlini (FT) Jan 4, 2017
Beijing’s claims of ‘huge progress’ are clearly overblown.

Venezuela's March Toward Default
Antony P. Mueller (Mises Daily) Jan 4, 2017
It is only a matter of time until Venezuela will default on its foreign debt.

China's Emerging Silicon Valley: How and Why Has Shenzhen Become a Global Innovation Centre
Xiangming Chen and Taylor Lynch Ogan (EFR) Dec 22, 2016
Shenzhen is China's very own Silicon Valley. Find out how it has become innovative by tracing its rapid growth and strategic transition; what are the four of its most innovative companies, and what are the key factors that make it an innovative ecosystem in which companies have thrived.

India's Cash Woes Are Just Beginning
Mihir Sharma (Bloomberg View) Jan 4, 2017
Signs of a manufacturing downturn herald more pain to come.

China Can't Quit the Dollar
Christopher Balding (Bloomberg View) Jan 4, 2017
There's only one exchange rate that really matters.

The West's Biggest Problem Is Dwindling Trust
Leonid Bershidsky (Bloomberg View) Jan 4, 2017
A decline in social capital drives surprising electoral outcomes.

Sterling's Post-Brexit Depression Looks Melodramatic
Mark Gilbert (Bloomberg View) Jan 4, 2017
The U.K.'s economic prognosis has improved. The pound? Not so much.

Can the EU Survive Populism?
Daniel Gros (Project Syndicate) Jan 4, 2017
National politicians sometimes succumb to popular pressure, adopting the rhetoric – and even the program – of their populist adversaries. But the EU can do no such thing, without effectively hastening its own demise.

Lessons from the Populist Revolt
Michael J. Sandel (Project Syndicate) Jan 4, 2017
Some denounce the populist rebellion in the US, the UK, and other countries as little more than a racist, xenophobic reaction against immigrants and multiculturalism. But to see only the bigotry in populist protest, or to view that protest only in economic terms, misses what the upheavals of 2016 were really about.

The effect of foreign investors on local housing markets
Filipa Sá (VoxEU) Jan 4, 2017
One of the factors driving house price growth in many countries is foreign investor demand. Using new UK data, this column argues that foreign investment has had a significant positive effect on house price growth in the last 15 years. The effect is not limited to expensive homes but ‘trickles down’ to less expensive properties, and is stronger where housing supply is less elastic. Foreign investment is also found to reduce the rate of home ownership, but there is no evidence of an effect on the housing stock or share of vacant homes. One of the factors driving house price growth in many countries is foreign investor demand. Using new UK data, this column argues that foreign investment has had a significant positive effect on house price growth in the last 15 years. The effect is not limited to expensive homes but ‘trickles down’ to less expensive properties, and is stronger where housing supply is less elastic. Foreign investment is also found to reduce the rate of home ownership, but there is no evidence of an effect on the housing stock or share of vacant homes.

Beijing’s dangerous mix of trade and security
FT View Jan 5, 2017
Bullying Korean companies over missile defence is counterproductive.

Donald Trump unleashes business’s animal spirits
Gillian Tett (FT) Jan 5, 2017
Corporate America is optimistic as C-suite players fill the top White House jobs.

The long and painful journey to world disorder
Martin Wolf (FT) Jan 5, 2017
As the era of globalisation ends, will protectionism and conflict define the next phase?

The UK mindset that heralds a disorderly Brexit
Philip Stephens (FT) Jan 5, 2017
Britain has regarded the EU as a commercial transaction not a political project.

China, Seeking to Stop Weakening of Currency, Issues Restrictions
Neiil Gough (NYT) Jan 5, 2017
Financial regulators appear to have become more concerned in recent weeks about the pace of the renminbi’s depreciation.

If Trump really knows the art of the deal, he’ll embrace free trade
Robert B. Zoellick (WP) Jan 5, 2017
In today’s competitive world economy, simply dropping out of agreements is unthinkable.

Managing Political Risk
Roy Shapira and Tarek Hassan (ProMarket) Jan 4, 2017
A recent working paper suggests that firms react to political risk, both passively by cutting investment and employment, and actively by ramping up lobbying efforts.

Giving Asia its due in global financial regulation
Nicolas Véron (Bruegel) Jan 5, 2017
With US inward turn, China should get a bigger role to bolster system.

NAFTA and Trump: Precursors to a Mexican Populist Wave?
Monica de Bolle (PIIE) Jan 5, 2017
President-elect Donald Trump's crusade against the North American Free Trade Agreement, or NAFTA, is producing a backlash in Mexico, lifting prospects for the opposition in the 2018 presidential elections. Andrés Manuel López Obrador (or AMLO, as he's popularly known), a leftist firebrand who...

As President, Trump Can Shackle Trade. But Will He?
Gary Clyde Hufbauer (PIIE) Jan 5, 2017
The US Constitution gives Congress the power “to regulate Commerce with Foreign Nations, and among the several States, and with the Indian tribes” (article I, section 8). So it’s not surprising that Senators and Representatives commonly believe that Congress has the first and last word on all measures affecting international trade.

Ukraine's Reforms Will Reap Economic Reward in 2017
Anders Aslund (FA/Feature) Jan 5, 2017
Three years after Ukraine’s revolution and after significant reform, the country’s economy has stabilized and is ready for growth. Dangers lie ahead, but opportunities are apparent.

Watch: All the World’s Global Trade in One Interactive Map
Robbie Gramer (FP) Jan 5, 2017
Watch global trade in action, from a new, data-driven vantage point.

In the Wake of Demonetization
K@W Jan 5, 2017
How will India's economy fare in 2017?

Alaska Airport Is a Big Link for the Global Supply Chain
Will Swagel (YaleGlobal) Jan 5, 2017
The subarctic airport in Anchorage airport is a natural place for refueling and ranks fourth in world for air cargo

Ford's Bow to Trump Benefits Robots, Not Workers
Mark Gilbert (Bloomberg View) Jan 5, 2017
While the auto industry is at the vanguard of automation, we're all potentially replaceable.

Want More Productivity? Be Careful What You Wish For
Tyler Cowen (Bloomberg View) Jan 5, 2017
Makers and sellers of dangerous drugs have had their technological breakthroughs. They're flourishing.

Democracy’s Broken Promises
Andrés Velasco (Project Syndicate) Jan 5, 2017
Populists are doing all they can do to undermine liberal democracy. But liberal democracy's current troubles may also reflect the widening gap between its practice and the expectations raised by some of its advocates.

Europe’s New “Indispensable Nations”
Joschka Fischer (Project Syndicate) Jan 5, 2017
President-elect Donald Trump has already undermined the credibility of America's longstanding security guarantee for Europe. The EU should now shore up what it can with respect to NATO and its own integration, while relying on its most powerful member states to provide an alternate security option.

The economic impact of Brexit-induced reductions in migration to the UK
Jonathan Portes and Giuseppe Forte (VoxEU) Jan 5, 2017
The various projections of the impact of Brexit on the UK economy that were produced during the referendum campaign omitted the economic impact of changes in migration to the UK. This column presents plausible scenarios for future migration flows and estimates of the likely impacts. The potential negative impact of Brexit-induced reductions in openness to migration on the UK economy could well equal that resulting from Brexit-induced reductions in trade. The various projections of the impact of Brexit on the UK economy that were produced during the referendum campaign omitted the economic impact of changes in migration to the UK. This column presents plausible scenarios for future migration flows and estimates of the likely impacts. The potential negative impact of Brexit-induced reductions in openness to migration on the UK economy could well equal that resulting from Brexit-induced reductions in trade.

Gaps in Trade Data Does Not Equal Criminal Money Laundering
Maya Forstater (CGD) Jan 6, 2017
The United Nations Conference on Trade and Development (UNCTAD) has recently reissued a new version of the report on commodity trade misinvoicing which caused such controversy last summer.

Trump’s trade policy: protecting American workers at the expense of American consumers
Dany Bahar (Brookings) Jan 6, 2017
Trade protectionism is the wrong policy, not only because it aims to protect the American workers at the expense of the consumers, but also because it will harm the most important determinant of economic growth: productivity.

The U.S. Economy in 2017: Why Uncertainty Is the ‘Biggest Risk’
Jeremy Siegel, Patrick Harker and Jeremy Schwartz (K@W) Jan 6, 2017
What lies ahead as the Trump administration assumes office this month.

The Pitfalls of Strongman Populism
Sergei Guriev (Project Syndicate) Jan 6, 2017
Growing anti-establishment sentiment in Western countries reflects an urgent need to compensate or assist those who have lost out economically. This is a painful lesson that post-communist countries learned the hard way during the 1990s, when the push for fast reforms created the conditions for autocratic leaders to take over.

2017: Through the Populist Looking Glass
Project Syndicate Jan 6, 2017
The main question at the start of the year is whether the post-1945 world order, now in its eighth decade, can be sustained once US President-elect Donald Trump takes office this month. To address that question, it is essential to understand how sustainable Trump’s power will be.

‘Peak trade’ is premature
Ian Tomb and Kamakshya Trivedi (VoxEU) Jan 6, 2017
It has become consensus to argue that we have approached ‘peak trade’ or the ‘end of globalisation’: that the past five years of stagnant global trade growth are not temporary, but instead reflect persistent forces that are likely to drive a continued stagnation in global trade over the long run. Though this view preceded the Brexit referendum, this column argues that it has now been amplified by the UK’s vote to leave the EU and the prospect that, potentially, US President-elect Trump and other leaders across developed markets will implement protectionist trade policies. The authors consider the arguments for ‘peak trade’, and conclude that, though downside risks to the trade outlook are prominent, there is little evidence – yet – that the current stagnation in global trade is predestined to extend far into the future. It has become consensus to argue that we have approached ‘peak trade’ or the ‘end of globalisation’: that the past five years of stagnant global trade growth are not temporary, but instead reflect persistent forces that are likely to drive a continued stagnation in global trade over the long run. Though this view preceded the Brexit referendum, this column argues that it has now been amplified by the UK’s vote to leave the EU and the prospect that, potentially, US President-elect Trump and other leaders across developed markets will implement protectionist trade policies. The authors consider the arguments for ‘peak trade’, and conclude that, though downside risks to the trade outlook are prominent, there is little evidence – yet – that the current stagnation in global trade is predestined to extend far into the future.

Low Interest Rates and the Financial System
Jerome H. Powell (FRB) Jan 7, 2017
"Low for long" interest rates have supported slow but steady progress to full employment and stable prices, which has in turn supported financial stability.

How Index Funds Democratize Investing
Barbara Novick (WSJ) Jan 8, 2017
Academic criticisms of indexing lack economic logic and factual support from the real world.

Trump and Ryan are right to tackle corporate taxes. But their approach would do harm.
Lawrence Summers (WP) Jan 8, 2017
The potential reforms they’ve identified could damage the tax base and the U.S. and global economies.

Australian exceptionalism amid global uncertainty
David Vines (EAF) Jan 8, 2017
The country's record of economic policy innovation that has served it so well until now might suggest that it can continue to navigate and manage the pressures to avoid looking inward and the shocks from the international system. But there is no guarantee.

Review – ‘When Britain Went Bust’
Diane Coyle (FT) Jan 9, 2017
The 1976 deal to borrow from the IMF was the climax of decades of weakness.

EM companies’ profitability rises above developed world
Steve Johnson (FT) Jan 9, 2017
Improvement driven by cost cutting rather than top-line growth.

The Cost of India's Man-Made Currency Crisis
NYT Jan 9, 2017
The economy is suffering, and there is little evidence that the swap is combating corruption.

The Future of Economics: From Complexity to Commons
Paul B. Hartzog (OECD Insights) Jan 9, 2017
This article looks at three crucial insights for the future of economics: Complex adaptive systems; how technologies of cooperation enable commons-based peer-to-peer networks; and why we need complex adaptive systems to understand new economies.

Is Globalization to Blame?
Dean Baker (Boston Review) Jan 9, 2017
While we cannot accept the racism and misogyny on which Donald Trump’s electoral victory fed, we must recognize that the white working-class voters who largely supported him have real grievances.

America's Builder-in-Chief Should Beware
Mihir Sharma (Bloomberg View) Jan 9, 2017
Infrastructure spending is no panacea.

The Next World Order
Ana Palacio (Project Syndicate) Jan 9, 2017
The annus horribilis of 2016 is behind us now. But its low points – the UK’s vote to leave the EU, the election of Donald Trump as US president, the ongoing atrocities in Syria – were symptoms of a process of dissolution of the liberal rules-based global order that began long before.

The Kindleberger Trap
Joseph S. Nye (Project Syndicate) Jan 9, 2017
Charles Kindleberger, one of the intellectual architects of the Marshall Plan, argued that the disastrous decade of the 1930s was a result of the United States' failure to provide global public goods after it had replaced Britain as the leading power. Today, as China’s power grows, will it make the same mistake?

Africa’s Unique Vulnerability to Violent Extremism
Mohamed Yahya (Project Syndicate) Jan 9, 2017
Africa bears the brunt of lives lost, economies ruined, and relationships fractured by terrorism: in the past five years alone, 33,000 people have died in terrorism-related violence on the continent. New research by the UN Development Programme helps to explain why.

Trumpian Uncertainty
Joseph E. Stiglitz (Project Syndicate) Jan 9, 2017
As the world’s largest economy leads the way into uncharted political waters in 2017 and beyond, it might be best to set aside the ordinary laws of economics. Which policies Donald Trump will pursue remains unknown, to say nothing of which will succeed or what the consequences will be.

Trump’s New Trade Guru May Actually Be the Adult in the Room
David Francis (FP) Jan 9, 2017
Robert Lighthizer, a former Reagan trade official, may have the legal chops to win concessions from China without sparking a trade war.

Time for a U.S.-Japanese Free Trade Agreement?
Michael Auslin (FA) Jan 9, 2017
How to proceed if the TPP is dead.

The ascendancy of international data flows
Jacques Bughin and Susan Lund (VoxEU) Jan 9, 2017
In around 25 years, the internet has become an integral part of our daily lives, connecting billions of users and businesses worldwide and leading to an explosion in the volume of cross-border digital flows. This column attempts to measure these flows and their impact on global activity in general. Global flows of goods, services, finance, people, and data have raised world GDP by at least 10% in the past decade, with the contribution to growth of GDP from data flows nearly matching the value of global trade in physical goods and services. In around 25 years, the internet has become an integral part of our daily lives, connecting billions of users and businesses worldwide and leading to an explosion in the volume of cross-border digital flows. This column attempts to measure these flows and their impact on global activity in general. Global flows of goods, services, finance, people, and data have raised world GDP by at least 10% in the past decade, with the contribution to growth of GDP from data flows nearly matching the value of global trade in physical goods and services.

Turkey’s self-inflicted crisis of confidence
FT View Jan 10, 2017
Only a swift and sizeable rise in interest rates will stabilise the lira.

Ringfencing will help in the next banking crisis
FT View Jan 10, 2017
The regulation is onerous but will be needed if a UK lender fails.

Donald Trump is making America safe for business
Thomas Donohue (FT) Jan 10, 2017
The president-elect intends to embrace his role as an agent of transformation.

A new year, but old problems for Mexico
Dan Bogler (FT) Jan 10, 2017
A weak peso, slowing economy, rising inflation and unpopular government are potent mix.

The highs and lows of hipster capitalism
Sarah O’Connor (FT) Jan 10, 2017
Artisanal globalisation offers some control but cannot fix all economic problems

Why Remittance Taxes to Finance a Border Wall are a Bad Idea … for the US
Monica de Bolle (PIIE) Jan 10, 2017
President-elect Donald Trump has adjusted his campaign pledge to make Mexico pay for building a border wall and now plans to ask Congress for funds to build the wall first—and then get Mexico to reimburse the cost.

Nobel Laureates: Eliminating Rent Seeking and Tougher Antitrust Enforcement Are Critical to Reducing Inequality
Asher Schechter (ProMarket) Jan 10, 2017
Angus Deaton: “A lot of the inequality in the U.S. comes from rent seeking. It comes from firms and industry seeking special protection or special favors from the government.”

What is key for the OECD in 2017? An open economy perspective
Noe van Hulst (OECD Insights) Jan 10, 2017
As we start a year that Ian Bremmer (President Eurasia Group) has coined as entering ‘the geopolitical recession’, it is worth asking what the OECD focus could be in 2017.

Britain's Dangerous Post-Brexit Borrowing Binge
Mark Gilbert (Bloomberg View) Jan 10, 2017
Brits are piling on the pounds in the form of increased debts. That's a risk.

Why the Baltics Want to Move to Another Part of Europe
Leonid Bershidsky (Bloomberg View) Jan 10, 2017
If Latvia, Lithuania and Estonia succeeded in rebranding themselves as Nordic, foreign investment would follow.

High Inflation, Low Rates Are a Threat to Merkel
Leonid Bershidsky (Bloomberg View) Jan 10, 2017
German savers and renters are suffering from ECB policies, and euroskeptics will exploit it.

China's Currency Policies Need an Overhaul
George A Magnus (Bloomberg View) Jan 10, 2017
It needs to shore up foreign-exchange reserves, which have shrunk by $1 trillion since 2014.

Trump Through Chinese Eyes
Jeffrey N. Wasserstrom (Project Syndicate) Jan 10, 2017
Since winning the US presidential election, Donald Trump's popularity in China has plummeted, owing to his statements on contentious issues like Taiwan and the South China Sea. The abrupt change in Chinese sentiment toward Trump is reminiscent of what happened to US President Woodrow Wilson after his reelection a century ago.

Trump’s Defective Industrial Policy
Dani Rodrik (Project Syndicate) Jan 10, 2017
Donald Trump has yet to take office, but his brand of flawed industrial policy has been on full display since his surprise election victory. Once Trump is inaugurated, we can expect his administration to vacillate between cronyism and bullying, while doing little for American workers or the economy as a whole.

The Age of Trump
Joseph E. Stiglitz (Project Syndicate) Jan 10, 2017
Rising inequality, an unfair political system, and a government that spoke for the people while acting for the elites after the 2008 financial crisis created ideal conditions for a candidate like Donald Trump. American leaders who have mismanaged the process of globalization have only themselves to blame for the coming era.

The Price of Oil: Why it rose stupendously over the past 40 years, why it is likely to remain low, and what this means for the world economy.
Roberto F. Aguilera and Marian Radetzki (EFR) Jan 10, 2017
Our recent book, The Price of Oil, provides an in-depth examination of the price of the world's most important commodity. We argue that although oil has experienced an extraordinary price increase over the past few decades, we have now reached a turning point where scarcity, uncertain supply and high prices will be replaced by abundance, undisturbed availability and suppressed price levels. In this article, we look at the potential of new global oil revolutions to bring the upward price push to an end and examine the implications of this turnaround for the world economy.

The future of central bank independence
Wouter den Haan, Martin Ellison, Ethan Ilzetzki, Michael McMahon and Ricardo Reis (VoxEU) Jan 10, 2017
Over the past 30 years, most central banks across the advanced economies have been given the ability to conduct monetary policy independently from interference by fiscal and political authorities. The latest Centre for Macroeconomics and CEPR expert survey invited views on whether this era of central bank independence is drawing to a close, particularly in Europe. Only 31 of the 70 respondents disagreed with the statement that there will be significant changes in the independence of monetary policy in the UK and the Eurozone in the foreseeable future. The survey also reveals that the well-established proposition among economists that a reduction in central bank independence will lead to higher inflation is no longer taken for granted, but maintaining central bank independence remains desirable. Over the past 30 years, most central banks across the advanced economies have been given the ability to conduct monetary policy independently from interference by fiscal and political authorities. The latest Centre for Macroeconomics and CEPR expert survey invited views on whether this era of central bank independence is drawing to a close, particularly in Europe. Only 31 of the 70 respondents disagreed with the statement that there will be significant changes in the independence of monetary policy in the UK and the Eurozone in the foreseeable future. The survey also reveals that the well-established proposition among economists that a reduction in central bank independence will lead to higher inflation is no longer taken for granted, but maintaining central bank independence remains desirable.

Saudi Arabia plans bond deal to help finance budget deficit
Elaine Moore and Simeon Kerr (FT) Jan 11, 2017
Country sharply affected by collapse in energy prices since 2014.

Chinese investment in EU dwarfs flow the other way
Tom Mitchell, Guy Chazan and Don Weinland (FT) Jan 11, 2017
Growing gap fuels debate on market imbalance as acquisitions soar in Germany.

Rebound in commodity-exporting nations set to boost global growth
Shawn Donnan (FT) Jan 11, 2017
World Bank warns of political uncertainties as it forecasts 2.7 per cent growth.

Peso sinks to fresh low as Mexico woes mount
Pan Kwan Yuk and Jude Webber (FT) Jan 11, 2017
Battered currency has already shed 4% in 2017 amid trade fears.

What does it mean to be literate in the 21st century?
Kolleen Bouchane (Aljazeera) Jan 11, 2017
We need large-scale systemic revolution in education.

How successful were the Millennium Development Goals?
John McArthur and Krista Rasmussen (Brookings) Jan 11, 2017
Did the United Nations' Millennium Development Goals (MDGs) make any difference? John McArthur and Krista Rasmussen examine which trajectories changed, for better or worse, and dispel some common myths about the MDGs.

2017: Saudi Arabia’s Annus Horribilis?
James M. Dorsey (Globalist) Jan 11, 2017
Think that 2016 was a tough year for Saudi Arabia? Wait till you see 2017.

The Challenge of Economic Inclusion
Christine Lagarde (Project Syndicate) Jan 11, 2017
In 2016, the world’s attention was focused on major political developments in the US and Europe, where voters have expressed deeply held concerns about trade, migration, and the changing nature of work. The same forces driving these upheavals will continue to pose challenges in the new year.

Record Chinese outward investment in 2016: Don't overreact
Derek Scissors (AEI) Jan 11, 2017
China's investment around the world grew almost 50 percent in 2016 to approximately $175 billion. It has now doubled in size since 2012. China's global spending surge is due primarily to investment in the United States, which exceeded $50 billion in 2016. Acquisitions by private enterprises are at its heart. Energy made a surprise comeback in 2016, leading all sectors in drawing Chinese funds. However, a bigger story was a jump in attempted and successful technology acquisitions. This year will be weaker than last. Total investment may or may not fall, but diversification by country, sector, and the Chinese companies is likely to decline. American policy should be based on actions by China and Chinese investors, reciprocity and obeying US law, respectively, rather than nominal state ownership.

World leaders reckon with a global rebalancing
Klaus Schwab (FT) Jan 12, 2017
Interdependence is seen as weakness and nationalism has been rekindled.

Andy Haldane is wrong: there is no crisis in economics
David Miles (FT) Jan 12, 2017
Brexit forecast failures tell us nothing new.

Brazil’s central bank in bold move to kick-start economy
Jonathan Wheatley (FT) Jan 12, 2017
Interest rate cut of 75bp comes as unemployment is growing and the recovery slows.

Offshore renminbi enjoys extended show of strength
Jennifer Hughes and Hudson Lockett (FT) Jan 12, 2017
Chinese currency’s outperformance versus onshore rate could help brake mainland outflows.

Rex Tillerson’s attack on China adds to a febrile atmosphere
James Kynge (FT) Jan 12, 2017
Donald Trump’s team may be hoping to gain negotiating leverage.

Don’t Let the Dollar Inhibit Growth
Sean Rushton (WSJ) Jan 11, 2017
A soaring currency could slow exports, fueling populist anger. Time for another Plaza Accord?

China’s Global Semiconductor Raid
WSJ Jan 12, 2017
Beijing accelerates its predatory approach to sensitive technologies.

Beyond Brexit: How the UK Can Lead the World in Trade for Development
Michael Anderson, Ian Mitchell and Lee Crawfurd (CGD) Jan 12, 2017
In contrast to Donald Trump’s election as US president, the UK’s Brexit campaign[1] and subsequent government response have emphasised that the UK will be outward-looking, embrace free trade and build new economic relationships. UK Prime Minister Theresa May has set the ambition for the UK to be a “global leader on free trade.”

We Are on the Verge of Darkness
Kenneth Roth (FP) Jan 12, 2017
The global rise of populism is a dangerous threat to democracy and human rights. And if it goes unchecked, the rollback of Western values could be staggering.

Donald Trump Is Making the Great Man Theory of History Great Again
David A. Bell (FP) Jan 13, 2017
President-elect Donald Trump’s unpredictable rise is forcing historians and social scientists to rethink their most basic assumptions about how the world works.

Democracy, Inclusion, and Prosperity
Raghuram Rajan (Project Syndicate) Jan 12, 2017
It is a truism that people everywhere want to live in a safe, prosperous country where they enjoy freedom of thought and action, and can exercise the right to choose their government. But the world faces a disarming question in 2017 and the years ahead: how can we be sure that political freedom and economic prosperity go together?

Trump Before Trump
Barry Eichengreen (Project Syndicate) Jan 12, 2017
Understanding the political success of US President-elect Donald Trump is not easy, and there have been many glib comparisons with earlier populist US politicians, from Huey Long to George Wallace. But the most revealing comparison may be with an historical figure from another country: the British nativist firebrand Enoch Powell.

The Emergence of a Post-Fact World
Francis Fukuyama (Project Syndicate) Jan 12, 2017
One of the more striking developments of 2016 was the emergence of a “post-fact” world, in which virtually all authoritative information sources are challenged by contrary facts of dubious quality and provenance. In a world without gatekeepers, there is no reason to think that good information will win out over bad.

Immigration and economic prosperity
Florence Jaumotte, Ksenia Koloskova and Sweta C. Saxena (VoxEU) Jan 12, 2017
Rapidly ageing populations, the refugee crisis, and growing anti-immigration rhetoric have brought immigration issues to the forefront recently. Using a panel of 18 countries, this column explores the long-term effects of migration on receiving advanced economies’ GDP per capita and labour productivity. Both high- and low-skilled migrants are found to raise productivity and GDP, and these gains appear to be broadly shared across the population. Rapidly ageing populations, the refugee crisis, and growing anti-immigration rhetoric have brought immigration issues to the forefront recently. Using a panel of 18 countries, this column explores the long-term effects of migration on receiving advanced economies’ GDP per capita and labour productivity. Both high- and low-skilled migrants are found to raise productivity and GDP, and these gains appear to be broadly shared across the population.

US tariffs are an arbitrary and regressive tax
Jason Furman, Katheryn Russ and Jay Shambaugh (VoxEU) Jan 12, 2017
Tariffs – taxes on imported goods – likely impose a heavier burden on lower-income households, as these households generally spend more on traded goods as a share of expenditure/income and because of the higher level of tariffs placed on some key consumer goods. This column estimates the tariff burden by income group and by family structure using a new dataset constructed by matching of granular data on trade and consumer spending. The findings suggest that tariffs function as a regressive tax that weighs most heavily on women and single parents. Tariffs – taxes on imported goods – likely impose a heavier burden on lower-income households, as these households generally spend more on traded goods as a share of expenditure/income and because of the higher level of tariffs placed on some key consumer goods. This column estimates the tariff burden by income group and by family structure using a new dataset constructed by matching of granular data on trade and consumer spending. The findings suggest that tariffs function as a regressive tax that weighs most heavily on women and single parents.

Management and Resolution of Banking Crises: Lessons from Recent European Experience
Patrick Honohan (PIIE) Jan 12, 2017
Several European countries endured severe and costly banking collapses in the past decade. Central banks (both within the euro area and outside) provided extensive liquidity to keep the payments system running smoothly in most—but not all—of these countries. The policy approaches to resolve the...

Is the Brazilian Central Bank Coming to Grips with the Country’s Balance Sheet Recession?
Monica de Bolle (PIIE) Jan 13, 2017
After months of waiting for the Brazilian Central Bank to move more aggressively on interest rates as the country’s historic recession continued unabated, the monetary authority has finally cut the reference rate (Selic) by 75 basis points and signaled that it is ready to move at this pace over the next few months.

Five Leadership Priorities for 2017
Klaus Schwab (Project Syndicate) Jan 13, 2017
As the past year has demonstrated, leaders must be responsive to the demands of the people who have entrusted them to lead, while also providing a vision and a way forward. As leaders in government, business, and civil society chart a course for the next year, five key challenges will warrant their attention.

Authentic Leadership
Ricardo Hausmann (Project Syndicate) Jan 13, 2017
The theme of this year’s World Economic Forum in Davos, Switzerland, is “Responsible and Responsive Leadership.” But one possible reading of Donald Trump’s victory in the US presidential election is that voters these days care less about responsibility than “authenticity.”

Helicopter money: Loved, not spent
Ian Bright and Senne Janssen (VoxEU) Jan 13, 2017
With growth and inflation in Europe remaining low, the idea of helicopter money is slowly gaining traction with politicians and economists alike. This column presents the results of a survey that asked people how, if they were to receive an extra €200 per month to do with as they chose, they would use the money. There was broad support for the policy among respondents, but only about one in four said they would spend most of the money. The findings suggest that a larger impact might be achieved if instead the money were given to the government to finance projects. With growth and inflation in Europe remaining low, the idea of helicopter money is slowly gaining traction with politicians and economists alike. This column presents the results of a survey that asked people how, if they were to receive an extra €200 per month to do with as they chose, they would use the money. There was broad support for the policy among respondents, but only about one in four said they would spend most of the money. The findings suggest that a larger impact might be achieved if instead the money were given to the government to finance projects.

Confusion about the lender of last resort
Ulrich Bindseil and Luc Laeven (VoxEU) Jan 13, 2017
The scale and scope of central bank lender of last resort operations during the Global Crisis raised concerns that central banks may be taking excessive risks and supporting moral hazard. This column argues that criticism of such operations is misguided. In the crisis, central banks did not make financial losses when acting as lender of last resort, which shows that they have applied their frameworks with prudence. The scale and scope of central bank lender of last resort operations during the Global Crisis raised concerns that central banks may be taking excessive risks and supporting moral hazard. This column argues that criticism of such operations is misguided. In the crisis, central banks did not make financial losses when acting as lender of last resort, which shows that they have applied their frameworks with prudence.

Lessons for US Business Tax Reform from International Tax Rates
Gary Clyde Hufbauer and Zhiyao (Lucy) Lu (PIIE) Jan 13, 2017
With the election of Donald Trump and a Republican Congress, business tax reform seems a likely bet for 2017. International tax rate comparisons using a new dataset from Thomson Reuters highlight the unfavorable disparity between US corporate tax rates and practices in other advanced economies.

Inflation is on the way back in the rich world, and that is good news
Economist Jan 14, 2017
Deflationary fears are at last on the point of being banished.

How Davos Brings the Global Elite Together
Michael J. de la Merced and Russell Goldman (NYT) Jan 14, 2017
The resort town in the Swiss Alps becomes home to heads of state, captains of industry and others each year during the World Economic Forum.

Confused attempt to fix US corporate taxation
FT View Jan 15, 2017
Republicans have the wrong answers to some of the right problems.

Xi Jinping’s chance to woo the world’s elite in Davos
FT View Jan 15, 2017
Political and business leaders look to China to soothe frayed nerves.

A warning for the losers of the liberal elite
Wolfgang Münchau (FT) Jan 15, 2017
If you make the same mistakes in the battles of 2017, populists will win everywhere.

The political gulf over Brexit is growing at an alarming rate
Sebastian Payne (FT) Jan 15, 2017
Britain’s stance prompts fears of a messy divorce in Europe.

Managing Globalization More Prudently
Michael Zürn (Globalist) Jan 15, 2017
Five principles for a better and more inclusive path forward on managing global issues.

China's Latest Innovation? The Ballpoint Pen.
Adam Minter (Bloomberg View) Jan 15, 2017
It's an object lesson in state-run inefficiency.

Europe’s rich since 1300
Guido Alfani (VoxEU) Jan 15, 2017
Recent research into the share of wealth owned by the richest households has given us important insights into trends in inequality. This column shows how we can now estimate the share of wealth owned by the richest households in Europe, and how many they numbered, from 1300 to the present day. Throughout this time, the only significant declines in inequality were the result of the Black Death and the World Wars. Recent research into the share of wealth owned by the richest households has given us important insights into trends in inequality. This column shows how we can now estimate the share of wealth owned by the richest households in Europe, and how many they numbered, from 1300 to the present day. Throughout this time, the only significant declines in inequality were the result of the Black Death and the World Wars.

Russia needs a revolution to reform its economy
FT View Jan 16, 2017
Kudrin does well to make the case for change in geopolitical terms.

Vienna’s fate is a cautionary tale for post-Brexit London
Frederick Studemann (FT) Jan 16, 2017
Notebook – a veteran monarch once reigned over a dynamic city... in Austria.

South Africa: looking up
Dan Bogler (FT) Jan 16, 2017
Investors should reassess assets in a more positive light.

Trump’s Antitrade Warriors
WSJ Jan 16, 2017
The President-elect may ask Congress for a new tariff bill.

When Japan Attacked Globalism
Stephan Richter (NAR) Jan 16, 2017
In a curious role reversal, it was a Japanese Prime Minister who stole the march on Trump and his anti-globalism chants.

Should we rely on economic forecasts? The wisdom of the crowds and the consensus forecast
Brian Dowd (OECD Insights) Jan 16, 2017
Economics and especially economic forecasting are often given a bad rap. Many people think of forecasting as akin to licking a finger and testing the wind. However, there is a science to it.

The Changing Fortunes of the Renminbi and the Dollar
Joseph P. Joyce (CEF) Jan 16, 2017
Last fall the International Monetary Fund announced that China’s currency, the renminbi, would be included in the basket of currencies that determine the value of the IMF’s reserve asset, the Special Drawing Right (SDR).

Theresa May's Brexit Was Always Going to Be Hard
Mark Gilbert (Bloomberg View) Jan 16, 2017
The British Prime Minister needs to tell the nation what her post-Brexit vision looks like.

Debate: Can China Survive Trump?
Tom Orlik & Michael Pettis (Bloomberg View) Jan 16, 2017
This week, President Xi Jinping will attend the Davos forum for the first time -- a sign of how concerned China is about a possible retreat from globalization. Till now, easy access to world markets has underpinned the country's remarkable expansion. How badly Chinese growth could be hurt by new trade barriers may be the most pressing question facing the world economy. Beijing University professor Michael Pettis, one of the best-known China skeptics, is gloomy; Bloomberg Intelligence economist Tom Orlik, less so. They met online to debate China's prospects.

Economic Prosperity in the Digital Age
John Chambers (Project Syndicate) Jan 16, 2017
The US is now the only developed economy without a clear digitization plan. If the country hopes to retain its status as a global economic leader in the Digital Age, which is essential to fulfilling its citizens' demands for more economic opportunities, this will have to change – and fast.

The Trump Deficit
Kenneth Rogoff (Project Syndicate) Jan 16, 2017
It is a post-financial-crisis myth that austerity-minded conservative governments always favor fiscal prudence while redistribution-oriented progressives view large deficits as the world’s biggest free lunch. This simplistic perspective badly misses the true underlying political economy of deficits.

Lessons from Germany for Integrating Refugees
Norbert Winkeljohann (Project Syndicate) Jan 16, 2017
When Germany received about 1.1 million refugees in 2015, it did not buckle. On the contrary, it has handled the pressure exceedingly well, proving that the refugee crisis really is a valuable opportunity for host countries' economies.

Getting Past the Globalization Bogeyman
Angus Deaton (Project Syndicate) Jan 16, 2017
According to its critics, globalization leads to an inexorable increase in income and wealth inequality: the rich get richer, and everyone else gets nothing. But the first thing we need to understand about globalization is that it has benefited an enormous number of people who are not part of the global elite.

Here's Looking At You, 2050
Paul Taylor (FP) Jan 16, 2017
How a less Christian Europe, an aging population in the West, and the empowerment of women are going to shape the future.

The surprising prevalence of surprises in export specialisation
Diego Daruich, William Easterly and Ariell Reshef (VoxEU) Jan 16, 2017
In economic development debates, many call for national industrial policies to help pick winners. This column shows that while a few export goods account for the bulk of export value within each country, hyper-specialisations are very unstable, making it unlikely that industrial policy will work even in the medium run. The best policy to promote exports would be just to let entrepreneurs exploit new opportunities as they arise. policies to help pick winners. This column shows that while a few export goods account for the bulk of export value within each country, hyper-specialisations are very unstable, making it unlikely that industrial policy will work even in the medium run. The best policy to promote exports would be just to let entrepreneurs exploit new opportunities as they arise.

Rapid Money Supply Growth Does Not Cause Inflation
Richard Vague (Evonomics) Jan 16, 2017
Neither do rapid growth in government debt, declining interest rates, or rapid Increases in a central bank’s balance sheet

Sell the Brexit rumour, buy the fact
Elaine Moore (FT) Jan 17, 2017
For equities and bonds, it all comes back to sterling.

Italy resists Brussels’ tough love on banks
Ferdinando Giugliano (FT) Jan 17, 2017
In theory, Rome has plenty to gain from embracing the ECB’s new regime.

Xi positions China as the protector of globalisation at Davos
Gideon Rachman (FT) Jan 17, 2017
The president’s remarks were a skilful appeal to business.

Moldova leader vows to scrap EU trade deal for Moscow-led bloc
Kathrin Hille and Neil Buckley (FT) Jan 18, 2017
Dodon comments a significant blow to Brussels’ Eastern Partnership.

Fate of free trade depends on the whims of Donald Trump
Alan Beattie (FT) Jan 17, 2017
The US president-elect has bought into the idea that the global economy is a zero-sum game.

Davos elite needs to heed wrath of the ‘left behind’
Chris Giles (FT) Jan 17, 2017
Almost all countries are failing to improve growth rates.

Kuwait closer to first sale of dollar debt
Elaine Moore (FT) Jan 17, 2017
Emirate to join other Gulf states in doing mega-bond deals amid low oil prices.

No right turn for Spanish politics
Tobias Buck (FT) Jan 17, 2017
Despite an economic meltdown rightwing populists failed to gain a foothold in the country. Why?

Theresa May’s Brexit makes offshore UK a reality
Brian Caplen (Banker) Jan 17, 2017
Banks will need to be more entrepreneurial to gain the benefits from what looks likely to be a clean break from the EU for the UK.

Trump's Trade Plan Is a Looming Disaster
Bloomberg View Jan 17, 2017
Even by his standards, the president-elect's position is stunning in its recklessness.

Samsung's Scandal, South Korea's Shame
Bloomberg View Jan 17, 2017
The country needs to transform the huge companies that dominate its economy.

The Bear Market in Bonds Already Looks Shaky
Scott Dorf (Bloomberg View) Jan 17, 2017
The "fast money" may have miscalculated that they can defy history.

China's Yuan Woes Get Worse
Christopher Balding (Bloomberg View) Jan 17, 2017
The government's goals are in irresolvable tension.

Trump's Rejection of the EU Could Make It Stronger
Leonid Bershidsky (Bloomberg View) Jan 17, 2017
As the U.S. and Britain pull away, few European nations are big enough to face an increasingly dangerous world on their own.

India's Central Bank Must Save Itself
Mihir Sharma (Bloomberg View) Jan 17, 2017
The RBI's reputation for autonomy and competence has been dealt a severe blow.

Be Skeptical of the Fed's Rate Signals
Komal S Sri-Kumar (Bloomberg View) Jan 17, 2017
China’s and Europe’s weaknesses may make three hikes in 2017 difficult.

The New Year and the New Populism
Margaret MacMillan (Project Syndicate) Jan 17, 2017
Protest movements throughout history have furnished ideas and leaders that eventually became part of the political mainstream. The populist campaigns that gained so much ground in 2016, most notably in the UK and the US, are different, because they categorically deny the establishment’s legitimacy.

In Defense of Globalization
Jim O'Neill (Project Syndicate) Jan 17, 2017
Thanks to globalization, economic inequality among countries has declined sharply in the past 20 years, reflecting not only China’s rise, but also economic development across Asia, Latin America, and elsewhere. Are globalization’s critics – those who wrongly consider it a zero-sum game – against eradicating global poverty?

Economic Impossibilities for Our Grandchildren?
Kaushik Basu (Project Syndicate) Jan 17, 2017
The reason lower- and middle-class people are suffering economically is not immigration or trade, but rather the steady march of technology. As jobs are replaced by machines or off-shored to emerging economies, global GDP is expanding, but the benefits are accruing only to the top earners.

Trump, Corporatism, and the Dearth of Innovation
Edmund S. Phelps (Project Syndicate) Jan 17, 2017
America’s innovative spirit has been weakened by a corporatist ideology that has permeated all levels of government, displacing the individualist ideology upon which capitalism thrives. Under Donald Trump, corporatism could become even more extreme, resembling the disastrous approach taken by Germany and Italy in the 1930s.

Xi Jinping, Head of World’s Largest Communist Party, Champions Global Trade
Emily Tamkin (FP) Jan 17, 2017
Chinese President Xi Jinping, head of the world’s largest Communist party, champions global trade in Davos, while Trump's advisor there says pulling out of global trade deals will be good for globalism.

US Dollar Reigns Supreme for Developing World, But Not For Long
Will Hickey (YaleGlobal) Jan 17, 2017
The developing world fails to enact structural reforms, cannot borrow in their currencies, and depends on the US dollar

Finance and growth: The direction of causality
Eilyn Yee Lin Chong, Ashoka Mody and Francisco Varela Sandoval (VoxEU) Jan 17, 2017
Recent research suggests a point beyond which the benefits of financial development diminish, and further development can even hurt growth. This column describes how a negative relationship between credit and growth emerged strongly after 1990 and was particularly pronounced in the Eurozone, consistent with the notion that an overgrown financial sector weakens economic growth potential. It also argues that slower growth leads to more rapid financial sector expansion. Policymakers need to be aware of the possibility that causality runs in both directions. Recent research suggests a point beyond which the benefits of financial development diminish, and further development can even hurt growth. This column describes how a negative relationship between credit and growth emerged strongly after 1990 and was particularly pronounced in the Eurozone, consistent with the notion that an overgrown financial sector weakens economic growth potential. It also argues that slower growth leads to more rapid financial sector expansion. Policymakers need to be aware of the possibility that causality runs in both directions.

ASEAN in 2017: Can the Region Sidestep Trump's Trade Threats?
K@W Jan 17, 2017
The 10 ASEAN nations are awaiting the inauguration of U.S. President-elect Donald Trump with growing trepidation.

Emerging powers can be saviours of the global liberal order
Amitav Acharya (FT) Jan 18, 2017
Brexit and Trump’s victory do not put China, Russia and India in the driving seat.

Inequality Doesn't Create Poverty
Ryan McMaken (Mises Daily) Jan 18, 2017
When egalitarians like Oxfam say some people are "worse off," they really mean those people are getting rich more slowly than some others.

Emerging powers can be saviours of the global liberal order
Amitav Acharya (FT) Jan 18, 2017
Brexit and Trump’s victory do not put China, Russia and India in the driving seat.

The Trumped-Up Dollar
WSJ Jan 18, 2017
Faster growth from better economic policies will lead to a bigger buck

Davos Elite Fret About Inequality Over Vintage Wine and Canapés
Peter S. Goodman (NYT) Jan 18, 2017
Power brokers are in the Swiss Alps to discuss how to make globalization more lucrative, but there is no appetite for redistributing wealth or empowering workers.

May’s Brexit Will Be Both Hard and Risky
Jacob Funk Kirkegaard (PIIE) Jan 18, 2017
British Prime Minister Theresa May presented her opening gambit on January 17 for the upcoming Brexit negotiations. She signaled that her government strives for a clean and hard Brexit, including a UK departure from the EU Internal Market and—apparently—the EU Customs Union.

The Euro's Parity Party Is on Hold
Jason M Schenker (Bloomberg View) Jan 18, 2017
After a period of decline, the fundamentals backing the currency are suddenly looking up.

Trump Is Right: 'Border Adjustment' Tax Is Complicated
Caroline Freund (Bloomberg View) Jan 18, 2017
House Republicans say it’s just like a value-added tax. Here’s why it isn’t.

Which Way for Emerging Markets in 2017?
Jim O'Neill (Project Syndicate) Jan 18, 2017
The prevailing economic forecast for 2017 predicts that, under President-elect Donald Trump’s incoming administration, the US will expand its fiscal-stimulus policies, the dollar will strengthen, and emerging markets will suffer. But there are four reasons to doubt the conventional wisdom.

Aligning the West for an Uncertain World
Iain Conn (Project Syndicate) Jan 18, 2017
Just when the West needs alignment among the US, the UK, and the EU, national politics are pulling it apart. There are common forces behind the UK's Brexit referendum, Donald Trump's election in the US, and the rise of nationalism across Europe.

The Illusions Driving Up US Asset Prices
Robert J. Shiller (Project Syndicate) Jan 18, 2017
Speculative markets have always been vulnerable to illusion, and in the US, two have been sustaining asset-price gains since November's presidential election. But seeing the folly in markets provides no clear advantage in forecasting outcomes, because changes in the force of an illusion are difficult to predict.

Meeting the Populist Challenge
Dominic Barton (Project Syndicate) Jan 18, 2017
As the 2016 populist uprising made clear, private-sector executives can no longer celebrate the far-reaching benefits of global capitalism, while ignoring its costs. They, along with politicians and policymakers, have a major part to play in solving such problems as rising inequality, stagnant wages, and structural unemployment.

The Economic Policy Trump Should Pursue
Mark Malloch Brown (Project Syndicate) Jan 18, 2017
As Donald Trump assumes the US presidency, a group of 35 prominent international business leaders is stepping forward to defend open markets, endorse the fight against climate change, and demand a massive push against global inequality. These are the core elements of the only viable economic strategy for the US and the world.

We Are the Last Defense Against Trump
Daron Acemoglu (FP) Jan 18, 2017
America's institutions weren't designed to resist a modern strongman. That leaves civil society.

Risk, surprises and safe-haven currencies
Adrian Jäggi, Martin Schlegel and Attilio Zanetti (VoxEU) Jan 18, 2017
Identifying the exact triggers for safe-haven flows in not easy, nor is tracking the ways in which demand for safe havens materialises. This column uses an empirical analysis of movements of the Swiss franc and Japanese yen since 2000 to show that these safe-haven currencies reacted strongly to non-domestic macro surprises, especially during the Global Crisis, and that this is in addition to the expected reaction to general changes in the risk environment. Oddly, for European macro surprises, only German data influence safe-haven currencies. Identifying the exact triggers for safe-haven flows in not easy, nor is tracking the ways in which demand for safe havens materialises. This column uses an empirical analysis of movements of the Swiss franc and Japanese yen since 2000 to show that these safe-haven currencies reacted strongly to non-domestic macro surprises, especially during the Global Crisis, and that this is in addition to the expected reaction to general changes in the risk environment. Oddly, for European macro surprises, only German data influence safe-haven currencies.

Ending too big to fail
Stephen Cecchetti and Kim Schoenholtz (VoxEU) Jan 18, 2017
‘Too big to fail’ is an enduring problem for financial authorities and regulators. While forbidding government bailouts may be a popular move, the strategy lacks credibility. This column examines the proposals of the Minneapolis Plan to End Too Big to Fail. The plan has many virtues that tackle systemic problems and that build on the Dodd-Frank Act’s crisis prevention and management tools. However, further analysis of the plan is still needed to ensure that its measures aren’t circumvented. ‘Too big to fail’ is an enduring problem for financial authorities and regulators. While forbidding government bailouts may be a popular move, the strategy lacks credibility. This column examines the proposals of the Minneapolis Plan to End Too Big to Fail. The plan has many virtues that tackle systemic problems and that build on the Dodd-Frank Act’s crisis prevention and management tools. However, further analysis of the plan is still needed to ensure that its measures aren’t circumvented.

Brexit, Donald Trump and the threat to Europe
Philip Stephens (FT) Jan 19, 2017
Britain is courting a president-elect who looks forward to the unravelling of the EU.

The ‘Internet of Bicycles’ is China’s latest export
Michael Moritz (FT) Jan 19, 2017
App-driven bike rentals are a model for global innovation.

Theresa May takes her ‘global Britain’ vision to Davos
Sebastian Payne (FT) Jan 19, 2017
The UK prime minister wants to show Britain is open after Brexit.

UK Prime Minister Theresa May Outlines Brexit Negotiating Goals
Bridges, Volume 21, Number 1 Jan 19, 2017
UK Prime Minister Theresa May outlined her government's objectives for the expected "Brexit" negotiations on Tuesday 16 January, making clear that she plans to take the United Kingdom out of the EU's single market and instead craft a free trade agreement (FTA) with the bloc's remaining 27 members.

Annual Davos Meet Kicks Off With Globalisation in the Spotlight
Bridges, Volume 21, Number 1 Jan 19, 2017
The World Economic Forum's (WEF) Annual Meeting in the Swiss ski resort town of Davos-Klosters got underway on Tuesday 17 January, bringing together leaders from international organisations, national governments, industry, academia, and the media for several days of high-level discussions.

Eyes on CETA Ratification Ahead of EU Trade Committee Vote
Bridges, Volume 21, Number 1 Jan 19, 2017
Efforts to ratify an EU-Canada trade deal have seen progress in Europe, with the agreement receiving the backing of the European Parliament's environment, public health, and food safety (ENVI) committee last week.

Abe, Turnbull Highlight Commitment to TPP, Trade Ties in Bilateral Talks
Bridges, Volume 21, Number 1 Jan 19, 2017
Australian Prime Minister Malcolm Turnbull and Japanese Prime Minister Shinzo Abe met in Sydney last weekend to discuss a host of trade issues, including their plans to move forward with the Trans-Pacific Partnership (TPP) Agreement.

Britain’s Pound Depreciation Isn’t Working
Samuel Tombs (WSJ) Jan 19, 2017
Manufacturing has proved immune to currency stimulus. But imports keep going up, up, up.

Theresa May Says Britain Will Lead a New Era of Free Trade
Steven Erlanger and Stephen Castle (NYT) Jan 19, 2017
It was a jarring note from the leader of a country leaving the world's largest free-trade group. She also urged the Davos elite to seriously address inequality.

Aid in Reverse: Facts or Fantasy?
Maya Forstater (CGD) Jan 19, 2017
A comment piece published in the Guardian earlier this week argued that for every $1 of aid that developing countries receive, they lose $24 in net outflows. The 1 to 24 figure is shocking and morally compelling. But it isn’t true.

Trump Goes Brazil: Import Substitution on His Mind
Stephan Richter and Rogerio Studart (Globalist) Jan 19, 2017
Is the new US President really trying to resolve the competitiveness challenge by relying on outdated 1960s style, Brazilian economic concepts?

Populism and the Future of Central Banking
Lucrezia Reichlin (Project Syndicate) Jan 19, 2017
With populist movements gaining ground, their complaints about independent monetary policymakers could now change the relationship between central banks, treasuries, and legislatures. The question for 2017 is whether that would be a good thing, or whether central-bank independence should be defended against the coming attack.

Brexit Into Trumpland
Philippe Legrain (Project Syndicate) Jan 19, 2017
British Prime Minister Theresa May is leading the UK toward a very hard Brexit in 2019 – and potentially off a cliff. Her objectives for negotiating with the EU make clear her intention to prioritize hardline Brexiteers’ demands over the country’s economic interests.

Taming the Chaebols
Lee Jong-Wha (Project Syndicate) Jan 19, 2017
At the heart of South Korea's political turmoil – in which the National Assembly has already the president impeached – is the reciprocal relationship between politicians and the giant family-owned conglomerates that dominate the economy. The government should take this opportunity to dismantle this decades-old system.

From Economic Analysis to Inclusive Growth
Kemal Dervis and Karim Foda (Project Syndicate) Jan 19, 2017
Developed-economy policymakers are seeking a recipe for inclusive economic growth, whereby high rates of investment and rapid innovation are pursued alongside measures to reduce income inequality. The Scandinavian model is often invoked in support of this approach, but could it really work in a country like the US?

Hope for Global Health in 2017
Melvin Sanicas (Project Syndicate) Jan 19, 2017
From the bombing of hospitals in conflict zones to the outbreak of the Zika virus, 2016 seemed to be one of unrelenting tragedy for global health. But, buried among all of the bad stories, there were some inspiring developments, including innovative diagnostic tools, new vaccines, and more.

Breaking the Oil Spell in 2017
Zhu Min (Project Syndicate) Jan 19, 2017
One clear lesson for oil-exporting countries in recent years, and especially in 2016, is that they should be adjusting their public policies to promote innovation and diversify their economies. These countries’ sole growth engine – oil revenues – is running in low gear, and will continue to do so indefinitely.

Business cycle desynchronisation
Ansgar Belke, Clemens Domnick and Daniel Gros (VoxEU) Jan 19, 2017
A high correlation of business cycles is usually seen as a key criterion for an optimum currency area. This column argues that the elasticity with which countries react to the common cycle is equally important. A country with a non-unitary growth elasticity relative to the common area will experience cyclical divergences at the peak and trough of the common cycle. Despite being characterised by highly-correlated business cycles, the Eurozone suffers from widely differing amplitudes. A high correlation of business cycles is usually seen as a key criterion for an optimum currency area. This column argues that the elasticity with which countries react to the common cycle is equally important. A country with a non-unitary growth elasticity relative to the common area will experience cyclical divergences at the peak and trough of the common cycle. Despite being characterised by highly-correlated business cycles, the Eurozone suffers from widely differing amplitudes.

The redistributive function of the EU budget
Paolo Pasimeni and Stéphanie Riso (VoxEU) Jan 19, 2017
EU budget reform is a key issue in policy debates, in particular the redistributive effects between member states. This column assesses redistribution within the EU budget over the period 2000 to 2014. It finds that the net redistributive impact of the EU budget is rather small and, contrary to common belief, that the revenue side is more progressive than the expenditure side. EU budget reform is a key issue in policy debates, in particular the redistributive effects between member states. This column assesses redistribution within the EU budget over the period 2000 to 2014. It finds that the net redistributive impact of the EU budget is rather small and, contrary to common belief, that the revenue side is more progressive than the expenditure side.

The Biggest Global Risks for 2017
K@W Jan 19, 2017
A report on the trends we need to watch.

Will Europe See a Political and Financial Crisis in 2017?
K@W Jan 19, 2017
The seismic shifts that could bring back the dark days of 2008.

Do We Want to Live in China’s World?
Robert Daly (ChinaFile) Jan 19, 2017
Each weekday morning, I cross D.C.’s National Mall and pass a sign on Constitution Avenue bearing an epigram by the U.S. architect Daniel Burnham: Make No Little Plans. And every morning, these words make me think not of Burnham’s 20th century United States, but of 21st century China. That is now where staggering plans are made and funded. Some Chinese plans will improve lives around the world, while others may erode the liberal international order the United States has led since 1945.

China is shaping up to be a world leader on climate change
Nicholas Stern (FT) Jan 20, 2017
Xi Jinping’s Davos speech showed promising signs.

The aid community should stop pretending to know the answers and start asking the right questions.
Frans Lammersen and Jorge Moreira da Silva (OECD Insights) Jan 20, 2017
Traditionally, development assistance has been rooted in a type of engineering, mass production, conveyor belt mentality, with agencies promoting “silver bullet” solutions for such complex problems as eradicating malaria, reducing vulnerability, improving resilience, strengthening connectivity etc. Unfortunately, piecemeal or one step at a time development programmes often failed to deliver.

The American Debt Trap
Noah Smith (Bloomberg View) Jan 20, 2017
Easy credit and heavy borrowing make it harder to do anything aside from holding a job and repaying loans.

The Middle East’s Next Moment of Reckoning
Larry Diamond and Hesham Sallam (Project Syndicate) Jan 20, 2017
When the Arab Spring erupted in December 2010, advocates for change in the Arab world had reason to be hopeful. But, as we saw in 2016, authoritarianism has returned, and whether that trend can be reversed in 2017 will depend on how well regional and international leaders have absorbed lessons from the recent past.

Trumping Capitalism?
Anatole Kaletsky (Project Syndicate) Jan 20, 2017
Donald Trump’s presidency is a symptom of an interregnum between economic orders – a period that will result in a new balance between state and market. While his administration’s economic policies are unlikely to provide the right answer, they may at least show the world what not to do.

Can Saudi Arabia Reform Itself?
Bernard Haykel (Project Syndicate) Jan 20, 2017
In 2017, Saudi Arabia will continue to pursue two key goals: to reduce its economy's dependence on oil revenues and government spending; and to position the Kingdom as a regional hegemon that can meet any threat. The country's transformation will be difficult, but it is necessary, not least for regional stability.

The innovation network
Daron Acemoglu, Ufuk Akcigit and William Kerr (VoxEU) Jan 20, 2017
Innovation is typically seen as a cumulative process, with new technologies building on existing knowledge - but our knowledge of how progress in a specific area is influenced by knowledge in other, ‘upstream’ areas is limited. Using US patent data, this column identifies a stable ‘innovation network’ that serves as a conduit for cumulative knowledge development. Technological advances in one field can advance progress in multiple neighbouring fields, but will have a stronger influence on more closely related areas. Innovation is typically seen as a cumulative process, with new technologies building on existing knowledge - but our knowledge of how progress in a specific area is influenced by knowledge in other, ‘upstream’ areas is limited. Using US patent data, this column identifies a stable ‘innovation network’ that serves as a conduit for cumulative knowledge development. Technological advances in one field can advance progress in multiple neighbouring fields, but will have a stronger influence on more closely related areas.

Risk-based capital requirements and international trade
Banu Demir Pakel, Tomasz Michalski and Evren Örs (VoxEU) Jan 20, 2017
The negative impact of higher capital requirements under Basel II on the provision of trade finance has been cited as one of the factors behind the Great Trade Collapse. This column exploits the adoption of the Basel II framework in Turkey in 2012 to investigate how a shock to the supply of trade-specific finance (in this case, letters of credit) affected firm-level exports. Changes in the cost of letters of credit affected Turkish firms’ reliance on trade finance, but the regulatory shock did not affect firm-level export growth. The negative impact of higher capital requirements under Basel II on the provision of trade finance has been cited as one of the factors behind the Great Trade Collapse. This column exploits the adoption of the Basel II framework in Turkey in 2012 to investigate how a shock to the supply of trade-specific finance (in this case, letters of credit) affected firm-level exports. Changes in the cost of letters of credit affected Turkish firms’ reliance on trade finance, but the regulatory shock did not affect firm-level export growth.

How deregulation and globalisation interact to boost economic growth
Sean Dougherty and Sarra Ben Yahmed (VoxEU) Jan 20, 2017
Globalisation offers many benefits, some of which cannot be separated from other types of policy. This column examines how the benefits from removing regulations that impede competition are partly contingent on openness to import competition. Using recent firm-level analyses of productivity growth, it argues that those firms that contribute the most to overall growth could also be held back by reduced openness, harming overall advances in incomes. Globalisation offers many benefits, some of which cannot be separated from other types of policy. This column examines how the benefits from removing regulations that impede competition are partly contingent on openness to import competition. Using recent firm-level analyses of productivity growth, it argues that those firms that contribute the most to overall growth could also be held back by reduced openness, harming overall advances in incomes.

Talk global, act local: Doing Brexit the hard way
Economist Jan 21, 2017
Theresa May opts for a clean break with Europe. Negotiations will still be tricky

Why 2017 May Be the Best Year Ever
Nicholas Kristof (NYT) Jan 21, 2017
For much of humanity, things keep getting better.

Trump and Putin’s New “Oligarchic International”
Alexei Bayer (Globalist) Jan 21, 2017
Putin cares as little about Russia as Trump does about America. They only care about making the world safe for the super-rich.

Adrift in Trump’s New Century
Ana Palacio (Project Syndicate) Jan 21, 2017
The late British historian Eric Hobsbawm famously called the period between Archduke Franz Ferdinand’s assassination in 1914 and the Soviet Union’s collapse in 1991 the “short twentieth century.” But, if anything, the twentieth century went long: it ended with Donald Trump's inauguration as US president.

Trump’s stimulus plans imply a stronger dollar
FT View Jan 22, 2017
The president cannot blame the Fed if the exchange rate starts to hurt.

Europe will pay unless the Brexit deal is a fair one
Wolfgang Münchau (FT) Jan 22, 2017
A sudden departure could end up permanently damaging the EU.

Will Trump Deliver a Growth Miracle? Don’t Count on It
Alan S. Blinder (WSJ) Jan 22, 2017
His policies promise marginal improvement at best. But then, he could always get lucky again.

Shoring up the US–Japan alliance under Trump
Hitoshi Tanaka (EAF) Jan 22, 2017
Trump's 'America First' foreign policy rhetoric is moving the United States away from its traditional role as a global leader at a time when the domestic and international political environments are undergoing significant change.

Trump and Xi Can Help Each Other on Trade
Bloomberg View Jan 22, 2017
Xi says globalization is good, and Trump says trade must be fair. So what’s the problem?

It's Time for Asia to Step Up
Mihir Sharma (Bloomberg View) Jan 22, 2017
The region is caught between an unpredictable U.S. and domineering China.

Why Inflation Won't Last
Satyajit Das (Bloomberg View) Jan 22, 2017
Rising prices are obscuring deeper problems.

The Rising Risk of Central Bank Instability
Mohamed Aly El-Erian (Bloomberg View) Jan 22, 2017
Investors may be underestimating the chance of a sudden shift in monetary policy.

Industrial policy in the UK, without the industry
FT View Jan 23, 2017
What the government should and should not do to boost productivity.

Africa: A shrinking space for autocrats
David Pilling (FT) Jan 23, 2017
Jammeh’s exit from Gambia is being hailed as proof of democracy’s resilience in region.

South Korea: reform is coming
Dan Bogler (FT) Jan 23, 2017
Power of president and chaebol is on the wane.

Trump’s Pacific Trade Retreat
WSJ Jan 23, 2017
The failure is a strategic win for China and a defeat for Japan’s Shinzo Abe.

Trump's greatest deal
Salvatore Babones (Aljazeera) Jan 23, 2017
Trump wants a weaker dollar. China wants a stronger yuan. Will they make a deal?

Why Attacking Free Trade Is Great Politics and Bad Economics
Roger Lowenstein (Fortune) Jan 23, 2017
If Donald Trump cracks down on trade, he will not be the first politician to fly in the face of economic wisdom, only the loudest.

Free Trade versus "Free Trade"
Peter G. Klein (Mises Daily) Jan 23, 2017
To economists, free trade means absence of government interference with trade. To politicians, "free-trade" means a complex set of managed policies.

Can Technology Prevent a Recession?
Frank Shostak (Mises Daily) Jan 23, 2017
It is sometimes argued that these technological advances now make us depression-proof.

Aging and urban divergence
Jaana Remes (Brookings) Jan 23, 2017
Cities in Japan, Western Europe, and the United States face stagnating or declining economic growth driven by aging populations and the slowing pace of urban migration.

‘Third World’ U.S. Airports? That Insults the Third World
John Tierney (WSJ) Jan 23, 2017
Private managers make terminals sparkle and hum the world over. Here we’re stuck with LaGuardia.

Postcard from Davos
Frances Seymour (CGD) Jan 23, 2017
The world’s elite—plus a few ringers like me—gathered last week in the small Swiss village of Davos to discuss the state of the world at the 2017 Annual Meeting of the World Economic Forum (WEF). Although not formally on the agenda, the issue of tropical forests infiltrated a number of discussions. But first, a quick recap of the meeting’s big themes that provided the broader context.

How Much Aid is Really Lost to Corruption?
Charles Kenny (CGD) Jan 23, 2017
One of the questions reportedly from the Presidential transition team to the State Department was: “With so much corruption in Africa, how much of our funding is stolen?” During the nomination hearings for Rex Tillerson to be Secretary of State, Senator Rand Paul provided one answer: seventy percent of aid is “stolen off the top.” The question is a fair one to ask. The bad news is that the short answer is “we don’t know.” The better news is that the slightly longer answer is “nowhere near 70 percent.” And the best news is that if we spent more time tracking the results of aid projects, we’d have a much better idea of where corruption was a problem and if our efforts to reduce it were working.

Abandoning Trade Will Make the Poor Poorer
Michael Schuman (Bloomberg View) Jan 23, 2017
Trump's agenda threatens the greatest source of wealth for the developing world.

Nobody Knows Why Markets Like Trump
Mark Whitehouse (Bloomberg View) Jan 23, 2017
Investor optimism about the new president contrasts with a lack of details about what he will do.

The U.K.'s Threat to Weaponize Tax Is No Bluff
Mark Gilbert (Bloomberg View) Jan 23, 2017
Britain is already cutting corporate taxes. Brexit may mean they head even lower.

Why the U.S. Has a Monopoly on Jobless Recoveries
Noah Smith (Bloomberg View) Jan 23, 2017
Most rich countries hire back workers after a recession. The U.S. replaces them with machines.

Xi Jinping’s Year of Living Dangerously
Minxin Pei (Project Syndicate) Jan 23, 2017
It might seem ludicrous to suggest that Chinese President Xi Jinping, the country’s most powerful leader since Mao, could be in trouble. But looks can be deceiving: the true test of Xi's authority will come in later this year, when the Chinese Communist Party holds it 19th National Congress to select China's next leaders.

China’s Debt-Trap Diplomacy
Brahma Chellaney (Project Syndicate) Jan 23, 2017
Through its $1 trillion “one belt, one road” initiative, China is supporting infrastructure projects in strategically located developing countries, often by extending huge loans to their governments. As a result, some of these countries are becoming saddled with debt, leaving them even more firmly under China's thumb.

A New Deal to Save Europe
Yanis Varoufakis (Project Syndicate) Jan 23, 2017
In the wake of the euro crisis, Europeans shudder at the thought of giving the EU more power over their lives and communities. That's why an alternative to EU leaders' push for European federalism must be found.

Breaking the WHO’s Glass Ceiling
Peter A. Singer and Jill W. Sheffield (Project Syndicate) Jan 23, 2017
This year, the World Health Organization will elect a new director-general, and Ethiopia's Tedros Adhanom Ghebreyesus is the strongest contender for the position. His direct experience working in developing countries makes him uniquely qualified to tackle the toughest global health challenges.

Risk sharing across the US and Eurozone
Valentina Milano and Pietro Reichlin (VoxEU) Jan 23, 2017
Risk sharing across the Eurozone is well below the levels observed in other federations, including the US. This column argues that the US achieves more intensive risk sharing largely because of a more integrated financial market, and also that the contribution of public institutions to risk sharing is much higher in the Eurozone than in the US. The reason why the Eurozone needs more fiscal transfers to withstand idiosyncratic shocks is not because these institutions should do more to improve risk sharing, but because delegation of risk sharing to national governments threatens the stability of the currency union. Risk sharing across the Eurozone is well below the levels observed in other federations, including the US. This column argues that the US achieves more intensive risk sharing largely because of a more integrated financial market, and also that the contribution of public institutions to risk sharing is much higher in the Eurozone than in the US. The reason why the Eurozone needs more fiscal transfers to withstand idiosyncratic shocks is not because these institutions should do more to improve risk sharing, but because delegation of risk sharing to national governments threatens the stability of the currency union.

Trading off a ’soft’ and ‘hard’ Brexit
Alen Mulabdic, Alberto Osnago and Michele Ruta (VoxEU) Jan 23, 2017
The British government and the EU face a difficult negotiation over the terms of Brexit. This column uses new data on the content of trade agreements to assess the trade impact of Brexit, identifying a tradeoff between the depth of the post-Brexit agreement and the intensity of future UK-EU trade. A ‘harder’ Brexit may have a stronger negative impact on the UK’s services trade and supply chain integration, which have relied more on the depth of the EU. This tradeoff will likely delimit future policy choices. The British government and the EU face a difficult negotiation over the terms of Brexit. This column uses new data on the content of trade agreements to assess the trade impact of Brexit, identifying a tradeoff between the depth of the post-Brexit agreement and the intensity of future UK-EU trade. A ‘harder’ Brexit may have a stronger negative impact on the UK’s services trade and supply chain integration, which have relied more on the depth of the EU. This tradeoff will likely delimit future policy choices.

Take the US president’s protectionism seriously
FT View Jan 24, 2017
Do not assume Donald Trump is bluffing in order to win better deals.

The Long Economic and Political Shadow of History
Stelios Michalopoulos and Elias Papaioannou (VoxEU) Jan 23, 2017
Over the past decades, economists working on growth have ‘rediscovered’ the importance of history, leading to the emergence of a vibrant, far-reaching inter-disciplinary stream of work. This column introduces a new eBook in three volumes which examines key themes in this emergent literature and discusses the impact they have on our understanding of the long-run influence of historical events on current economics. Over the past decades, economists working on growth have ‘rediscovered’ the importance of history, leading to the emergence of a vibrant, far-reaching inter-disciplinary stream of work. This column introduces a new eBook in three volumes which examines key themes in this emergent literature and discusses the impact they have on our understanding of the long-run influence of historical events on current economics.

Donald Trump and Xi Jinping’s battle over globalisation
Martin Wolf (FT) Jan 24, 2017
The US president’s rhetoric on trade reads like a declaration of economic warfare.

A global investment court for a changing era of trade
Cherie Blair (FT) Jan 24, 2017
Ad hoc mechanisms for settling investor-state disputes are not fit for purpose.

Ditching TPP Won't Solve the Trade Deficit
Jared Bernstein (NYT) Jan 24, 2017
If Trump is serious about balancing imports and exports, he needs to think bigger.

Closing doors on trade isn’t smart negotiating
WP Jan 24, 2017
Having killed the TPP, will Trump examine NAFTA in good faith?

Trump’s Real Trade Problem Is Money
John D. Mueller (WSJ) Jan 24, 2017
Protectionism won’t cure the import-export imbalance. The solution lies in monetary policy.

Protectionist pain: Trump's trade stance harms US interests
Mireya Solís and Josh Meltzer (The Hill) Jan 24, 2017
As one of his first official acts as president, Donald Trump withdrew the United States from the Trans-Pacific Partnership. This specific move, and this kind of trade protectionism more broadly, will deliver a series of self-inflicted blows to America’s economy and standing in the world.

Trumping World Trade
Dan Steinbock (WFR) Jan 24, 2017
After the inauguration, President Trump has begun to reset the White House trade policies. But the consequences of “America First” stance in world trade are wrought with threats.

The twilight of the liberal world order
Robert Kagan (Brookings) Jan 24, 2017
In recent years, the liberal world order that has held sway over international affairs for the past seven decades has been fragmenting under the pressure of systemic economic stresses, growing tribalism and nationalism, and a general loss of confidence in established international and national institutions. The incoming U.S. administration faces a grave challenge in determining whether it wishes to continue to uphold this liberal order, which has helped to maintain a stable international system in the face of challenges from regional powers and other potential threats, or whether it is willing to accept the consequences that may result if it chooses to abandon America’s key role as a guarantor of the system it helped to found and sustain.

The Brazilian Debt Hangover
Otaviano Canuto (RGE Economonitor) Jan 24, 2017
We touch on another dimension of Brazil’s economic boom and bust, namely, a credit cycle, the downward phase of which helps understand why the post-crisis recovery has been so hard to obtain.

No country left behind: The case for focusing greater attention on the world’s poorest countries
Laurence Chandy (Brookings) Jan 24, 2017
30 countries are at risk of being left behind in the pursuit of global poverty reduction.

Trump Killed TPP. What's Next For Trade in Asia?
Ankit Panda (Diplomat) Jan 24, 2017
Free trade in Asia is far from dead. The question now is whether the U.S. will reap any of the benefits.

TPP and the Democrats’ Failure to Manage Globalization At Home
Stephan Richter (Globalist) Jan 24, 2017
It’s a lop-sided world when a Republican billionaire turned President cancels a corporatist trade deal eagerly pursued by a Democratic administration.

Trump's First Trade Deal Should Be With Japan
Bloomberg View Jan 24, 2017
With the Trans-Pacific Partnership off the table, America's priority should be a bilateral trade pact.

Theresa May's Brexit Challenge
Bloomberg View Jan 24, 2017
The prime minister needs Parliament’s help to strengthen her negotiating position.

Market Liquidity Is Great, Until It Isn't
Noah Smith (Bloomberg View) Jan 24, 2017
Being able to readily buy or sell assets is crucial. But trouble lurks when it becomes too easy.

Trump's Gift to China
Michael Schuman (Bloomberg View) Jan 24, 2017
Withdrawing from TPP is a boon for the Middle Kingdom.

Multi-Speed Inflation Poses an ECB Dilemma
Mark Gilbert (Bloomberg View) Jan 24, 2017
Prices are starting to rise, but at very different rates for different euro members.

It Could Be Peak Big Mac. Or Just a Strong Dollar.
Justin Fox (Bloomberg View) Jan 24, 2017
McDonald's revenue fell again despite the debut of all-day breakfast. Fortunately for the fast-food giant, there's a catch.

The Economic Promise of Climate-Smart Infrastructure
Joaquim Levy (Project Syndicate) Jan 24, 2017
The time has come to think creatively and use investment in climate-smart infrastructure as a way to renew the globalization agenda. If we do, we can we help raise potential economic growth, boost shared prosperity, and move closer to eliminating extreme poverty around the world.

Will Trump Block Latin America’s Recovery?
José Antonio Ocampo (Project Syndicate) Jan 24, 2017
Last year, populism was routed in Argentina, and it was barely holding on in Venezuela. But, with Donald Trump's inauguration as US president coming at a delicate moment for most Latin American economies, the region may find itself dragged back into the political muck.

World Order 2.0
Richard N. Haass (Project Syndicate) Jan 24, 2017
Since the Peace of Westphalia in 1648 ended the Thirty Years’ War in Europe, the concept of sovereignty – the right of countries to an independent existence and autonomy – has formed the core of the international order. But, in a globalized world, an order based solely sovereign rights has become increasingly inadequate.

How central bank collateral frameworks distort the economy
Kjell G. Nyborg (VoxEU) Jan 24, 2017
Central banks inject money into the economy against collateral, but we know little about the terms of the exchange. This column argues that market forces or discipline have little role to play in the central bank collateral frameworks that are the foundation of the monetary and financial system. This distorts the financial system and wider economy – in the Eurozone, for example, political influence on these frameworks has created indirect bailouts of some banks and sovereigns. Central banks inject money into the economy against collateral, but we know little about the terms of the exchange. This column argues that market forces or discipline have little role to play in the central bank collateral frameworks that are the foundation of the monetary and financial system. This distorts the financial system and wider economy – in the Eurozone, for example, political influence on these frameworks has created indirect bailouts of some banks and sovereigns.

Leaning against the wind: Re-evaluating the evidence
Lars E.O. Svensson (VoxEU) Jan 24, 2017
The IMF and the Federal Open Market Committee have both suggested that the costs of ‘leaning against the wind’ exceed the benefits. This column responds to claims that the results of the author's research backing up this conclusion could be overturned. It argues that the alternative assumptions necessary to overturn the result are unrealistic, and that the finding that the costs of the policy exceed the benefits therefore seems to be robust. The IMF and the Federal Open Market Committee have both suggested that the costs of ‘leaning against the wind’ exceed the benefits. This column responds to claims that the results of the author's research backing up this conclusion could be overturned. It argues that the alternative assumptions necessary to overturn the result are unrealistic, and that the finding that the costs of the policy exceed the benefits therefore seems to be robust.

Trump’s New World Disorder
John Cassidy (New Yorker) Jan 24, 2017
His trade approach to China could lead to a crash in the global financial markets. And that would be just the beginning.

Crafting an action-driven response to China's digital trade barriers
Claude Barfield (AEI) Jan 24, 2017
China's digital Great Firewall and the new National Security and Cybersecurity Laws threaten vital high-technology sectors of the US economy. While the US and China have vital economic and diplomatic interests in common, the US should challenge China's digital trade barriers. The new administration could do so by establishing digital economic and security issues as a top priority for dialogues with China, establishing an Office of Trade Enforcement in the Office of the US Trade Representative, initiating a World Trade Organization case against China's Great Firewall, and being prepared to take reciprocity-based trade and investment retaliation.

Eight market-oriented proposals that reduce income inequality
Dean Baker (AEI) Jan 26, 2017
Debates over economic policy are often framed as conservatives supporting market-oriented policies, while progressives support government interventions. However, there are many market-oriented policies that can lead to more equality, an important goal for most progressives. This paper outlines eight policies that are likely to lead to greater equality through an increased reliance on the market.

NAFTA and other trade deals have not gutted American manufacturing — period
J. Bradford DeLong (Vox) Jan 24, 2017
Yes, America has been losing manufacturing job share at a furious rate. Yes, the spread between the incomes of the non-college-educated and the college-educated has widened massively. Yes, the spread between the incomes of even the college-educated and our overclass has exploded. But this is not due to NAFTA.

Coping with mixed feelings: What future for European trade policy?
Patricia Wruuck (DB Research) Jan 24, 2017
It is hard to overstate the importance of trade policy for Europe. The EU28 is the largest trading bloc, the top trading partner for about 80 countries worldwide and ranks 1st for in- and outbound investment. The EU’s free trade agreements (FTAs) vary substantially, depending on partners and policy priorities. “New generation trade agreements” go beyond traditional tariff reductions, including issues like services trade, intellectual property or investment. EU agreements to foster trade (and investment), however, have sparked mixed feelings more recently given the backlash against globalisation as well as EU-internal controversies over the power to strike such deals. Yet, the EU’s ability to conclude trade deals is also contingent on political support. Rising scepticism about globalisation means, that (potential) distributional effects of FTAs and their (potential) interaction with national legislation, is going to feature more prominently throughout negotiations and in the public debate.

Powerful forces will lead to a strong dollar under Trump
Barry Eichengreen (FT) Jan 25, 2017
The US president fails to see that his policy plans will drive the exchange rate up.

Democracy is good but trade matters too
David Pilling (FT) Jan 25, 2017
West African states have long been better at peace and security than integration.

Why Germany needs to accelerate into the digital fast lane
Guy Chazan (FT) Jan 25, 2017
A wave of disruption looms for the country’s flagship industries — cars and machines — from Silicon Valley innovation.

China Can Thrive in the Trump Era
Yan Xuetong (NYT) Jan 25, 2017
The country has a chance to become a full-fledged superpower if it responds to the Trump presidency by opening up more to the world.

Will Trump Go After Nafta With Tweezers or a Hammer?
Neil Irwin (NYT) Jan 25, 2017
To redo the trade deal, the U.S. may have to make concessions that the Trump administration will be wary of offering.

After Trump Rejects Pacific Trade Deal, Japan Fears Repeat of 1980s
Jonathan Soble (NYT) Jan 25, 2017
The apparent death of the multinational trade deal could force Tokyo to negotiate one-on-one with the United States, provoking potentially bruising showdowns.

Asia on the Brink of (Trade) War?
Shihoko Goto (Globalist) Jan 25, 2017
Following the U.S. withdrawal from the TPP, the Asia-Pacific region faces a lot of internal divisions over trade strategies.

Mnuchin Abandons the 'Strong Dollar' Mantra
Mark Gilbert (Bloomberg View) Jan 25, 2017
Trump's guy drops the "vacuous notion" that the Treasury can set the dollar's value. It's about time.

Trump Will Need Imports for His Domestic Priorities
Shelley Goldberg (Bloomberg View) Jan 25, 2017
His infrastructure program and anti-trade proposals don't go together.

R.I.P., TPP
Christopher Balding (Bloomberg View) Jan 25, 2017
It would've been a major advance for fair trade.

Trump Can't Kill the TPP
Mihir Sharma (Bloomberg View) Jan 25, 2017
Its most important principles will live on in future free-trade pacts.

China’s Big Sticks
Stephen S. Roach (Project Syndicate) Jan 25, 2017
The Trump administration's China-bashing strategy is based on the mistaken belief that a newly muscular US has all the leverage in dealing with its presumed adversary, and that any Chinese response is hardly worth considering. Nothing could be further from the truth.

Four Certainties About Populist Economics
Michael Spence (Project Syndicate) Jan 25, 2017
While few anticipated the British vote to leave the EU and Donald Trump's election as US president, neither outcome should have been all that surprising: disaffected voters were rejecting economic models that had produced high levels of inequality. The question now is what will replace those models.

National Debt and Global Order
Harold James (Project Syndicate) Jan 25, 2017
Having overseen a large debt-financed real-estate business, Donald Trump's intuition is that debt renegotiation can be used to win back for America what “other countries” have supposedly taken from it. He could even pursue a nationalistic version of what is typically a leftist demand: a debt jubilee or write-off.

Work in an Automated Future
Johan Aurik (Project Syndicate) Jan 25, 2017
The Fourth Industrial Revolution will disrupt employment, just as the previous three did. But before we assume the worst, we should recall that technological change has more often affected the nature of work, rather than the opportunity to participate in work itself.

Inclusive Capitalism or Bust
Andrew Liveris (Project Syndicate) Jan 25, 2017
Historically, there is no question that technological innovation and global commerce have underpinned rapid material progress and dramatic gains in living standards. But the global economy clearly is not serving everyone equally, and many people believe – with good reason – that it is not serving them at all.

America’s New President Is Not a Rational Actor
Stephen Walt (FP) Jan 25, 2017
Whether by accident or design, Donald Trump is isolating himself and erratically unraveling the world order.

Corruption Paradox
Ruby Mellen (FP) Jan 25, 2017
A report finds that anti-corruption populists tend to be more corrupt.

China: Canada's Strategic Imperative
Dan Ciuriak (CIGI) Jan 25, 2017
Why the case for a free trade agreement with China is compelling.

The productivity challenge to the British economy
Martin Wolf (FT) Jan 26, 2017
Physical investment is very low and skills remain highly deficient.

China’s central bank pre-new year prep highlights policy challenge
FT Confidential Research Jan 26, 2017
Huge funding but higher rates show struggle to balance short and long-term monetary goals.

The Trump-Brexit Opening
WSJ Jan 26, 2017
A U.S.-U.K. trade deal may never be easier to strike than right now.

Trump Begins Setting US Trade Policy Course During First Week in Office
Bridges, Volume 21, Number 2 Jan 26, 2017
The first week of Donald J. Trump's presidency of the United States has included both executive action and plans for meetings focused on trade, giving some early signals of the possible direction of the White House trade agenda and other policy priorities.

Davos Meeting Wraps Up with Warnings Against Protectionism
Bridges, Volume 21, Number 2 Jan 26, 2017
The World Economic Forum’s (WEF) Annual Meeting in Davos, Switzerland, wrapped up on Friday 20 January, capping several days of high-level speeches and meetings that dealt largely with how to deal with a perceived public backlash on globalisation and fears of mounting mercantilist pressures, among other topics.

CETA Clears Ratification Hurdle with EU Parliament Trade Committee Backing
Bridges, Volume 21, Number 2 Jan 26, 2017
The proposed Comprehensive Economic and Trade Agreement (CETA), a free trade agreement negotiated between Canada and the EU, acquired the support of the European Parliament’s trade committee (INTA) on Tuesday 24 January, advancing one step closer towards ratification of the deal.

A Tariff with Mexico Will Ensure Americans Pay for Border Wall
Tho Bishop (Mises Wire) Jan 26, 2017
"Tariff," after all, is just a fancy word for "tax."

The Mexican Border Tax: Will It Backfire?
Jeffrey J. Schott (PIIE) Jan 26, 2017
Less than a week after taking office, President Donald Trump is threatening a trade war with Mexico, one of the United States’ top trading partners, citing its refusal to pay a $10 billion to $20 billion bill to construct a wall on the border.

Cutting UN Funding Will Cost the US
Charles Kenny (CGD) Jan 26, 2017
The New York Times reported yesterday that the Trump Administration is considering a new Executive Order that mandates cutting all funding to bodies that give full membership to the Palestinian Authority and fund abortion amongst other categories, but also suggests “at least a 40 percent overall decrease” in remaining US funding towards international organizations. The proposed cuts would do almost nothing to reduce the deficit while weakening US national security and international leadership.

China is struggling to keep its currency high, not low
David Dollar (Brookings) Jan 26, 2017
Why U.S. officials are wrong to call China a currency manipulator and outlines what China is doing to address its credit gap and avoid a financial crisis.

Ireland and Brexit: Behind the Facade
Markus Heinrich (Globalist) Jan 26, 2017
How ordinary Irish people think Brexit will affect the Republic of Ireland.

Trade Deals Alone Won't Make Brexit a Success
Victoria Bateman (Victoria Bateman) Jan 26, 2017
The British prime minister is hoping that new trade deals will drive growth. It's the other way around.

Post-Brexit, the U.K.'s Future Is Creative
Leonid Bershidsky (Bloomberg View) Jan 26, 2017
The British cultural product is a major export, and it's less susceptible to trade barriers than most others.

Trump's Tough Talk on China Bodes Well for Dollar
Gary Shilling (Bloomberg View) Jan 26, 2017
No one wins a trade war, but the U.S. will probably lose less than China.

"Reform" Isn't the Answer for Everything
Satyajit Das (Bloomberg View) Jan 26, 2017
It's no easier politically, and less likely to have an impact than before.

How Trump Helps China
Daniel Silke (Project Syndicate) Jan 26, 2017
The “America first” policy that Donald Trump emphasized in his inaugural address may have won over frustrated voters in Iowa and Idaho – the overlooked and ignored who now feel vindicated by “their” victory. But Trump's words probably sound most pleasing of all in a China intent on nurturing its own substantial gravitational force.

Business Must Listen – and Lead
Beth Brooke-Marciniak (Project Syndicate) Jan 26, 2017
As countries turn inward, amid rising nationalism and intolerance, responsive leadership demands that we listen to the underlying message, and act accordingly. Problems such as slow growth, inequality, and technological disruption are affecting people's daily lives, and cannot simply be ignored.

Forget Dow 20,000 — the Boom Times Are Over. Is Democracy Next?
Zachary Karabell (FP) Jan 26, 2017
Liberal democracy and market capitalism are taken for granted as the best form of government. That bubble may be about to burst.

Next Debt Crisis Might Affect Emerging Market Corporate Sector
Anthony Rowley (YaleGlobal) Jan 26, 2017
Emerging markets enjoyed cheap loans since 2008, but now confront rising interest rates and a struggle to refinance

Globalisation and sectoral employment trends in Germany
Wolfgang Dauth, Sebastian Findeisen and Jens Südekum (VoxEU) Jan 26, 2017
The decline of manufacturing jobs in the US has been the focus of much attention recently, with rising trade with China cited as one explanation. This column describes how the German economy has experienced a similar secular decline in manufacturing and rising service employment, but that growing trade with China and Eastern Europe did not speed up this trend. In fact, rising exports to the new markets have stabilised industry jobs. The decline of manufacturing jobs in the US has been the focus of much attention recently, with rising trade with China cited as one explanation. This column describes how the German economy has experienced a similar secular decline in manufacturing and rising service employment, but that growing trade with China and Eastern Europe did not speed up this trend. In fact, rising exports to the new markets have stabilised industry jobs.

Is greatness finite?
Joyce E. Chaplin (Aeon) Jan 26, 2017
The world feels caught between infinite possibility and limited resources. Thomas More and T R Malthus can help

Theresa May will not find it easy to broker a US-UK trade deal
Alan Beattie (FT) Jan 27, 2017
British agriculture and financial services may suffer at hands of Capitol Hill.

Brazilian markets flying high over economic reality
Jonathan Wheatley and Joe Leahy (FT) Jan 27, 2017
Equities have soared in the last year, but the economic rebound has failed to emerge.

Mexico can thrive without Trump
Ernesto Zedillo (WP) Jan 27, 2017
Mexico has the economic tools to generate long-term growth without the United States.

TPP: Why the U.S. Withdrawal Could Be a Boon for China
K@W Jan 27, 2017
Experts say that President Trump's move to withdraw from the Trans-Pacific Partnership (TPP) paves the way for China to forge its own deals with other countries and dominate the world's major trading regions and routes.

Europe Needs New Rules for the Uber Economy
Bloomberg View Jan 27, 2017
Extending EU labor rights across the gig economy would backfire on workers.

Think About the U.K. in Nafta. Really.
Therese Raphael (Bloomberg View) Jan 27, 2017
If Trump is going to renegotiate a big U.S. trade deal, why not include post-Brexit Britain?

Trump Avoids Making a Trade Promise He Can't Keep
Eli Lake (Bloomberg View) Jan 27, 2017
The president showed savvy and restraint in his appearance with the British prime minister.

Congress Has the Power on Trade
Stephen Mihm (Bloomberg View) Jan 27, 2017
The president is in the driver's seat right now. But Congress has a long history of invoking its constitutional authority.

Why Latin America and Africa Struggle to Grow
Noah Smith (Bloomberg View) Jan 27, 2017
The reasons are very different, but the result is the same.

How Gulf States Can Offset the Dollar's Pull
John Sfakianakis (Bloomberg View) Jan 27, 2017
The region needs structural reforms that diversify the economy away from oil.

Trumping the Renminbi
Andrew Sheng and Xiao Geng (Project Syndicate) Jan 27, 2017
Contrary to Donald Trump's accusations, China has sought to keep the renminbi-dollar exchange rate relatively stable, in the face of strong downward pressure on the renminbi. At a time when US policy can change with a tweet, which exchange-rate policy would enable China to maintain currency stability?

Trump’s Ruinous Stance on Mexico Threatens America
Dan Restrepo (FP) Jan 27, 2017
If Trump continues to undermine Mexico, he will make the United States less prosperous and less secure.

It’s Time to Think for Yourself on Free Trade
Dani Rodrik (FP) Jan 27, 2017
What economists and populists both get wrong about the international economy:

Evidence on which aspects of central bank transparency matter
Anna Naszodi, Csaba Csavas, Szilard Erhart and Daniel Felcser (VoxEU) Jan 27, 2017
There is a notable lack of consensus about how central bank transparency affects uncertainty in the economy, as well as how transparency should be measured. This column reviews some recent contributions that highlight how transparency does not have consistent and unambiguous effects on economic uncertainty. Despite this ambiguity, transparency seems to be more often favourable than unfavourable. There is a notable lack of consensus about how central bank transparency affects uncertainty in the economy, as well as how transparency should be measured. This column reviews some recent contributions that highlight how transparency does not have consistent and unambiguous effects on economic uncertainty. Despite this ambiguity, transparency seems to be more often favourable than unfavourable.

Assessing the threat to central bank independence
Jakob de Haan and Sylvester Eijffinger (VoxEU) Jan 27, 2017
It has been observed that since the start of the Global Crisis, central banks in most advanced economies have become more powerful and political, but they have not become more accountable. This column discusses why central bank independence matters, and looks at whether it has changed since the crisis. It has been observed that since the start of the Global Crisis, central banks in most advanced economies have become more powerful and political, but they have not become more accountable. This column discusses why central bank independence matters, and looks at whether it has changed since the crisis.

The Questions That Could Reshape a Worried Europe in 2017
Rick Gladstone (NYT) Jan 28, 2017
The rise of populism, economic threats and the uncertainty of relations with the Trump administration are sources of turbulence for Europe.

In retreat: The multinational company is in trouble
Economist Jan 28, 2017
Global firms are surprisingly vulnerable to attack.

Multinationals: The retreat of the global company
Economist Jan 28, 2017
The biggest business idea of the past three decades is in deep trouble.

TPP is Dead, Now What?
David Dollar, Charlene Barshefsky, Wendy Cutler, Edward Friedman, Chen Weihua, Ho-fung Hung, George G. Chen & Scott Kennedy (ChinaFile) Jan 27, 2017
On his first full working day as president, Donald Trump officially withdrew the United States from the Trans-Pacific Partnership (TPP). What kinds of opportunities does U.S. withdrawal create for China to build a Beijing-led regional trade architecture? What changes can we expect in Asia as China assumes a larger role in shaping trade rules?

How the Tohoku earthquake affected offshoring
Lianming Zhu, Koji Ito and Eiichi Tomiura (VoxEU) Jan 28, 2017
We still know little about how firms alter their global sourcing patterns when facing uncertainty and shocks. This column uses Japanese firm-level data compiled after the Great East Japan earthquake of 2011 to show that firms in affected areas reacted immediately by offshoring more, but that this affect was significant only in the manufacturing sector. Policies to facilitate offshoring would support such emergency responses in future. We still know little about how firms alter their global sourcing patterns when facing uncertainty and shocks. This column uses Japanese firm-level data compiled after the Great East Japan earthquake of 2011 to show that firms in affected areas reacted immediately by offshoring more, but that this affect was significant only in the manufacturing sector. Policies to facilitate offshoring would support such emergency responses in future.

Beijing will avoid taking the lead on Pacific trade
FT View Jan 30, 2017
A free-for-all is the likely result of the US withdrawal from TPP.

How Europe can avoid falling into Trump’s trap
Wolfgang Münchau (FT) Jan 29, 2017
Hard-bargain rhetoric on Brexit drives the UK into the hands of the US.

Trump is obsessed with trade — but it’s not a major cause of job loss
Robert J. Samuelson (WP) Jan 29, 2017
Manufacturing’s decline began in the 1950s and ’60s, well before the onset of annual trade deficits.

What Trump Means for Brexit, China, and the EU
Alasdair Macleod (Mises Daily) Jan 29, 2017
President Trump has dramatically changed the balance of power in Britain’s trade negotiations with the EU.

India's Got a Reputation Problem
Mihir Sharma (Bloomberg View) Jan 29, 2017
The government has to do more to ease fears of long-term investors.

A time of test for the China model of economic growth
Suisheng (Sam) Zhao (EAF) Jan 29, 2017
Recently, a neo-authoritarian sentiment has emerged in China criticising the decentralisation of the state authority for weakening central planning bureaucracies and creating opportunities for some intellectuals to advocate liberal ideas from the West.

The mounting challenge of economic nationalism
FT View Jan 30, 2017
Business leaders around the world wake up to the power of Donald Trump.

Economic forecasters need alternative thinking in this uncertain world
Martin Sandbu (FT) Jan 30, 2017
Predictions must ditch the crutch of a ‘central’ outcome.

Nafta: First shots in a trade war
Jude Webber, Shawn Donnan and John Paul Rathbone (FT) Jan 31, 2017
Trump’s policies jeopardise a $580bn relationship with the US’s neighbour, but Mexico has a few cards to play in any talks.

Trump's Trade War May Have Already Begun
Peter S. Goodman (NYT) Jan 30, 2017
With Mr. Trump threatening punitive tariffs on Mexican and Chinese imports, some American allies are shifting focus to other potential alliances and sources of trade.

Trump's Unfashionable Tax Idea
Thomas Nakios (NYT) Jan 30, 2017
Americans will have to get used to paying a whole lot more for shoes, shirts and TVs.

Trump Spells Trouble for Eastern Europe
Simeon Djankov (PIIE) Jan 30, 2017
In his first week in office President Donald Trump created plenty of anxiety in other countries. Mexico was the initial casualty of his announced policy shift towards tariffs on foreign goods, but several other countries, from Germany to Vietnam, were named on his "watch" list because of their trade surpluses with the United States. Eastern Europe is missing so far from this list, but the region will suffer the effects of Trump’s new policies in at least three ways.

Can Mexico Retaliate Against US Trade Actions?
Kent Boydston (PIIE) Jan 30, 2017
The debate over imposing a 20 percent border adjustment tax against Mexico has raised a number of questions, but one of the most imponderable is whether and how Mexico might retaliate should such a tax be adopted. The question is more than hypothetical.

Demonetisation: India’s stress test
Suman Bery (Bruegel) Jan 30, 2017
What were the reasons for the Indian government's sudden decision to remove 86% of hard currency from circulation? Will Modi's monetary intervention achieve its stated aim of fighting corruption? And what will be the wider implications for growth?

A new narrative for a complex age
Eric Beinhocker (OECD Insights) Jan 30, 2017
If 2008 was the year of the financial crash, 2016 was the year of the political crash.

Trump's Dumb War on Nafta
Bloomberg View Jan 30, 2017
There are improvements to make to the deal -- but that's not how the president would see it.

Central Banks Will Keep Policies Unchanged -- for Now
Mohamed Aly El-Erian (Bloomberg View) Jan 30, 2017
The focus shifts to what governments will and won't do.

The Growing Burden of the 'Trump Tax'
Justin Fox (Bloomberg View) Jan 30, 2017
Political uncertainty takes a toll on growth and investment.

Three Surprises in 2017
Anatole Kaletsky (Project Syndicate) Jan 30, 2017
Donald Trump’s economic policies are likely to produce higher US inflation and interest rates, and more dollar appreciation, than financial markets expect. But Europe could stabilize after France's presidential election, ushering in a period of healthy economic growth and strong financial performance.

What’s the Matter With Germany?
Federico Fubini (Project Syndicate) Jan 30, 2017
It should come as no shock that Italy and crisis-plagued Greece are the eurozone’s weakest performers in terms of per capita GDP growth over the last three years. What is surprising is that Germany is the third-weakest performer.

Playing with Economic Matches
Ashoka Mody (Project Syndicate) Jan 30, 2017
Recently released forecasts anticipating a global growth revival in the coming years are missing the big picture. US President Donald Trump's policies will erode the norms and institutions that govern markets, and come at a time when the global economy is already fragile.

An Unstable Economic Order?
Mohamed A. El-Erian (Project Syndicate) Jan 30, 2017
The retreat of the advanced economies from regional and global institutions has received a lot of attention lately. But while the destabilization of multilateral economic and financial structures could be particularly devastating for developing countries, the entire global economy will be adversely affected if the trend continues.

Trust in Markets and Antitrust in Media
Sergei Guriev (Project Syndicate) Jan 30, 2017
Oligarchs routinely use media ownership to solidify their political positions, which they can then use to secure rents from which they can fund media. That is why ownership should be transparent, with, ideally, media owners prohibited from owning other assets.

The economics, regulation, and systemic risk of insurance markets
Felix Hufeld, Ralph Koijen and Christian Thimann (VoxEU) Jan 30, 2017
Despite the importance of insurance, discussions about the macroeconomic role and the risks of insurance markets have been surprisingly limited. This column explores some of the key theoretical and conceptual questions still unanswered in this field, and suggests that a two-fold approach combining a focus on individual firms and an activity-based approach across the sector is needed to tackle systemic risk within the insurance industry. Despite the importance of insurance, discussions about the macroeconomic role and the risks of insurance markets have been surprisingly limited. This column explores some of the key theoretical and conceptual questions still unanswered in this field, and suggests that a two-fold approach combining a focus on individual firms and an activity-based approach across the sector is needed to tackle systemic risk within the insurance industry.

The economic impact of colonialism
Daron Acemoglu and James Robinson (VoxEU) Jan 30, 2017
The immense economic inequality we observe in the world today is the path-dependent outcome of a multitude of historical processes, one of the most important of which has been European colonialism. This column, taken from a recent Vox eBook, discusses how colonialism has shaped modern inequality in several fundamental, but heterogeneous, ways. The immense economic inequality we observe in the world today is the path-dependent outcome of a multitude of historical processes, one of the most important of which has been European colonialism. This column, taken from a recent Vox eBook, discusses how colonialism has shaped modern inequality in several fundamental, but heterogeneous, ways.

Bank of Japan catches a fortunate tailwind
FT View Jan 31, 2017
Further monetary stimulus will help growth to maintain momentum.

A European green card can help the British economy after Brexit
Roger Casale (FT) Jan 31, 2017
The valuable economic contribution of EU citizens must be protected.

China: standing still in the year of the rooster
Dan Bogler (FT) Jan 31, 2017
Steady economic growth and financial stability are top priorities for Beijing as it focuses on politics.

Donald Trump’s tough talk will not bring US jobs back
Martin Wolf (FT) Jan 31, 2017
China played an insignificant role in the decline of manufacturing.

Trump and Trade: Extreme Tactics in Search of a Point
Eduardo Porter (NYT) Jan 31, 2017
Rejecting the premise of international accords is one thing. But displaying irrationality for effect, without a rational objective, can end in war.

A Climate Change Economist Sounds the Alarm
Mark Buchanan (Bloomberg View) Jan 31, 2017
A leading supporter of the go-slow approach appears to have changed his mind.

Brace for a 60-Billion Euro Brexit Battle
Mark Gilbert (Bloomberg View) Jan 31, 2017
The EU will want the U.K. to settle its debts before discussing post-Brexit relations.

Markets Are Right Not to Fall in Line With Fed's Dots
David A Ader (Bloomberg View) Jan 31, 2017
Traders and central bankers aren't in alignment, as both await Trump's fiscal stimulus plans.

Alarms Are Sounding in European Bonds
Mark Gilbert (Bloomberg View) Jan 31, 2017
Europe has more than just Brexit to cope with in the coming months.

Deutsche Bank's Russian Scheme Isn't Needed in 2017
Leonid Bershidsky (Bloomberg View) Jan 31, 2017
The German bank paid a fine for helping Russians move money out of the country -- at a time when capital outflow has almost halted.

Harnessing the Politics of Disruption
Mark Leonard (Project Syndicate) Jan 31, 2017
Donald Trump's election as US president and the UK's Brexit vote revealed a deep generational divide. But while cosmopolitan millennials and nationalist pensioners may seem to be staring at one another across an abyss, they have one thing in common: at the root of their frustration is a failure of political representation.

Why the EU Must Be Generous to Britain
Hans-Werner Sinn (Project Syndicate) Jan 31, 2017
EU officials seem determined to make an example of the UK, by denying it a free-trade agreement unless it accepts free movement of people. But, as counter-intuitive as it may seem, refraining from punishing the UK for leaving is the best way to keep other member states in.

Is the Deflation Cycle Over?
Carmen Reinhart (Project Syndicate) Jan 31, 2017
After a decade of deflationary pressure, central banks will probably not overreact if inflation overshoots their targets in the near term. In fact, there is now growing support for higher inflation targets, to give central banks more space to lower interest rates in the event of a future recession.

How Trump's Trade Agenda Will Affect the Dollar
Ben Emons (Bloomberg View) Jan 31, 2017
Fears of protectionism hurting the U.S. economy have put pressure on the greenback.

Surviving the Next Housing-Market Hurricane
Mark Roe (Project Syndicate) Jan 31, 2017
Disturbing evidence has emerged suggesting that, overall, the global financial system is no safer today than it was in 2007. Most blame misguided regulation, but the real problem might be the evacuation plan – or, more precisely, the plan to avoid evacuation.

The Benefits of Free Trade: Addressing Key Myths
Donald J. Boudreaux and Nita Ghei (Mercatus) Jan 31, 2017
The growing rhetoric about imposing tariffs and limiting freedom to trade internationally reflects a resurgence of old arguments that stay alive in large part because the benefits of free international trade are often diffuse and hard to see, while the benefits of shielding specific groups from foreign competition are often immediate and visible. This newly updated policy briefing addresses some widespread myths about free trade.

Global talent mobility and human capital agglomeration
Sari Pekkala Kerr, William Kerr, Caglar Ozden and Christopher Parsons (VoxEU) Jan 31, 2017
The distribution of talent and human capital is highly skewed across the world. As high-income countries engage in a global race for talent, the resulting migration of high-skilled workers across countries tilts the deck even further. This column draws upon newly available data to outline the patterns and implications of global talent mobility. Key results include recent dramatic increases in high-skilled migration flows, particularly in certain occupations, in certain countries, among those with higher skill levels, and from a wider range of origins. The distribution of talent and human capital is highly skewed across the world. As high-income countries engage in a global race for talent, the resulting migration of high-skilled workers across countries tilts the deck even further. This column draws upon newly available data to outline the patterns and implications of global talent mobility. Key results include recent dramatic increases in high-skilled migration flows, particularly in certain occupations, in certain countries, among those with higher skill levels, and from a wider range of origins.

Spatial distribution of development: The roles of nature and history
Vernon Henderson, Tim Squires, Adam Storeygard and David Weil (VoxEU) Jan 31, 2017
Economists point to three factors to explain how population is distributed: geographical characteristics, agglomeration, and history. This column, taken from a new Vox eBook, examines how economic and technological development have changed the ways in which two first-nature characteristics – suitability for growing food and suitability for engaging in trade – impact population distribution. Economists point to three factors to explain how population is distributed: geographical characteristics, agglomeration, and history. This column, taken from a new Vox eBook, examines how economic and technological development have changed the ways in which two first-nature characteristics – suitability for growing food and suitability for engaging in trade – impact population distribution.

Trump Won't Get the Best Deals
Dani K. Nedal and Daniel H. Nexon (FA) Jan 31, 2017
Mind the gaps in world power.