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In RealTime posts, PIIE senior staff and colleagues discuss the fast-moving economic news, financial developments, and public policy choices confronting the United States and the world.
One of the bigger questions in this recession, which has been marked by the steepest increase in unemployment of any downturn since World War II,1 has to do with the impact on immigration. Theoretically, we would expect an influx from south of the border as the recession hits Mexico and other Latin American countries, but [...]
The administration’s top thinkers on banking regard themselves as avoiding “irreversible errors,” meaning precipitate moves on banking. They argue that “wait and see” may work out and, if it doesn’t, they can always take more dramatic action later (e.g., of the variety advanced by Thomas Hoenig of the Kansas City Fed). Writing in the NYTimes.com’s [...]
The road show for the guardians of the international economy moves this weekend from London, site of the G-20 summit earlier this month, to Washington, site of the annual meetings of the International Monetary Fund (IMF), the World Bank, and the world’s finance ministers and central bankers. We can hope that these leaders will translate [...]
In January, we calculated the likely impact of the global economic crisis by comparing the International Monetary Fund’s (IMF) growth forecast for the crisis years with the average growth in the precrisis period of 2005–07. Given the release of new growth forecasts, we update our exercise here, but focus on the forecast for 2009. Three [...]
If asked to offer parental career advice to teenagers on the Horn of Africa, most economists would probably recommend becoming a pirate. As a profession, piracy enjoys numerous standard economic advantages: Low Barriers to Entry: education and certification prerequisites limited to rudimentary seamanship, no need for student loans or entrance exams. Initial capital requirements are [...]
The case for keeping banks in something close to their current structure begins to take shape. It’s not about traditional claims that big banks are more efficient, or Lloyd Blankfein’s argument that this is the only way to encourage risk-taking, or even the House Financial Services Committee’s view that immediate resumption of credit flows is [...]
Many times, since I first used the phrase in 1989, the “Washington Consensus” has been proclaimed dead, most recently by Prime Minister Gordon Brown of Britain at the press conference following the G-20 summit in London earlier this month. Yet most of the governments of the world seem to be determined to follow the precepts [...]
There are two ways to think about inflation in today’s economy. The first, suggested by conventional macroeconomic frameworks for the United States, is that, with rising unemployment and actual output sinking further below “potential” output, inflation will stay low—and we could actually experience the dangers of falling wages and prices (think what happens to mortgage [...]
Whenever reform of health care is discussed in America, the argument that “America rejects socialized medicine” is heard in many quarters. Superficially, the facts suggest that the private sector has always accounted for the majority of healthcare expenditure in the United States (approximately 55 percent of total expenditures since the early 1990s1) and that private [...]
The Leaders’ statement from the London summit of April 2 is an improvement over the usual communiqués from international meetings by being much more concrete, readable, and substantial. It provides clear policy principles and specifies its agenda in sufficient detail. For Central and Eastern Europe, this statement is likely to be particularly important, because it [...]