454 Results for “inflation”

An interview with Thomas Ferguson on the 2024 US election conducted by Andrew Yamakawa Elrod and Tim Barker for Phenomenal World

Rob Johnson joins Background Briefing with Ian Masters to discuss public concern about inflation

The global economy appears to be stuck in a pattern of low growth, low inflation and unresolved debt burdens. Is this a result of policy mistakes, or have the fundamental dynamics of the economy shifted into an era of little or no growth known as secular stagnation?

How have the macroeconomic problems in the US blinded many participants and observers to the actual state of the American economy as the election approaches?

After an era of vigorous expansion a downturn can reveal a large stock of debt relative to the economy’s capacity to service it.

In the growing debate about the pros and cons of a monetary financed fiscal stimulus (a.k.a. helicopter money) it is argued by some participants that a money-financed stimulus will have no more effect than a debt financed stimulus since:

Price Inflation, Marginal Cost Pricing, and Principles for Electricity Market Redesign in an Era of Low-Carbon Transition

Any use of money-financed fiscal expansion as a policy tool will require rules to ensure discipline and avoid excess

Michael Greenberg’s INET working paper on derivatives regulation is featured in Salon

This paper argues that it is a mistake to dismiss secular demand stagnation as main cause of declining potential growth in the OECD.

Modern monetary theorists ignore how their policies could hurt developing countries

Central banks strongly favored rentier incomes in their reaction functions

The tough policy choices ahead for confronting the climate crisis

India’s economic leaders are determined to rein in skyrocketing inflation, but the country’s volatile political landscape may prevent reforms from taking hold.

INET is pleased to announce that Roman Frydman, Chair of INET’s Program on Imperfect Knowledge Economics, has published a book with Edmund Phelps, 2006 Nobel laureate and Director of the Center on Capitalism and Society at Columbia University, Rethinking Expectations: The Way Forward for Macroeconomics (Princeton University Press).

In recent decades, advanced economies have experienced low and stable inflation and long periods of liquidity trap. We construct an alternative business-cycle model capturing these two features by adding two assumptions to a money-in-the-utility-function model: the labor market is subject to matching frictions, and real wealth enters the utility function. These assumptions modify the two core equations of the standard New Keynesian model

The empirical analysis of public sector investments and the health value created by the drugs selected for Medicare price negotiations provides a cost basis for the assessment of the maximum fair price.

There is a mix of common-sense opinions, political prejudices, conventional business practice, and pragmatic rules of thumb, supported in an ad hoc, opportunistic way by bits and pieces of economic theory.

Going Down the Rabbit Hole at Jackson Hole

Wage Repression, Asset Price Inflation, and Structural Change Caused Rising Macroeconomic Inequality for Fifty Years from before Reagan through Trump.This is a summary of a new book that is being published as part of a new book series with Cambridge University Press.

This research project investigates the impact of the new style of central banking on the bank’s solvency, its ability to control inflation, and on economic stability.

Price inflation, marginal cost pricing, and principles for electricity market redesign in an era of low-carbon transition

Panic over the impact on  German savers of low interest rates and looming inflation neglects to mention that very few Germans are saving much

Stagnating real wages may have contributed to the slowdown of US productivity

Developments in the real economy have persistently challenged central tenets of older economic thinking, such as the supposed close connection between the money supply and inflation.

Everyone is waking up to the fact that estimates of what is possible in the economy are way off: this paper explains why

Low interest rate policy can only do so much to bring the relief to American borrowers that they deserve: past monetary policies, credit market regulations and stagnant labor productivity growth all get in the way. Interest rate policy activism is part of the problem, not the solution.

To able to deal with these consequences, our crisis response now should not lock us in into a permanent state of austerity, greater inequality and heightened vulnerability to future health calamities. New-old social democratic solutions are needed more than ever before.

Charles Goodhart, professor emeritus of the financial markets group at the London School of Economics, and Manoj Pradhan, founder of the research firm Talking Heads Macro, talk to Rob about their just released book, The Great Demographic Reversal: Ageing Societies, Waning Inequality, and an Inflation Revival

Out of Ammunition? A discussion on central banking and secular stagnation with Larry Summers and Adair Turner

Eight years after the crisis erupted, what the global economy is experiencing is starting to look less like a slow recovery than like a new low-growth equilibrium. With monetary policy unable to stimulate demand, or even inflation, it’s time for fiscal authorities to relieve the burden on central banks.

Possible repercussions of economic crisis on the stability of democracies that already show significant signs of fragility

Contrary to conventional wisdom, government stimulus can improve the health of the economy for years after, without inflationary side effects 

A model that captures key vulnerabilities and structural weaknesses of developing countries’ trade and production structures.

Medicare negotiators need to have a deep understanding - both theoretical and empirical - of the learning processes involved in developing a drug to negotiate a price that is fair.

This time is different. But is it?

What lessons need to be drawn on this anniversary?

What is your first association when somebody talks to you about the economy?

Contrary to the neoclassical loanable funds theory, historical bond yields show Keynes was right that “convictions” anchor long-term interest rates

“Panics are not needed for banking crises to have severe economic consequences,” says Emil Verner, the MIT professor who helped lead the study. “But when panics do occur, those tend to be the most severe episodes. Panics are an important amplification mechanism for banking crises, but not a necessary condition.” Indeed, in an ambitious piece of research, spanning 46 countries and going back to 1870, the study surveys banking crises that occurred with and without panics. When there is a panic and bank run, the research finds, a 30 percent decline in banking-sector equity predicts a 3.4 percent drop in real GDP (gross domestic product adjusted for inflation) after three years. But even without any creditor panic, a 30 percent decline in bank equity predicts a 2.7 percent drop in real GDP after three years.” — Peter Dizikes, MIT News

A new view of stock market instability under Knightian uncertainty

China is drowning in it. The whole world has too much of it. History suggests: This won’t end well.

The American state has lost the capacity for concentrated and decisive effort at the forefront of technology and the associated science.

That’s the question that Adair Turner, Chair of the UK Financial Services Authority, was addressing in his lecture to Cass Business School this week.

For all the talk of Modern Monetary Theory representing a brave new frontier, it is easy to forget that the United States has gone down this road before, when the US Federal Reserve financed the war effort in the 1940s. Then, as now, the question is not about government debt, but about the debt’s purpose and justification.

Viewed in historical context, the weak recovery from the 2008 crisis has been slow and painful, but a sub-5% unemployment rate and healthy job and wage growth will be among the most important legacies Obama leaves to the next president

“You can’t get out of debt by adding more debt.”

Do temporary economic shocks like the COVID-19 recession create lasting effects on the economy?

Contrary to the neoclassical model’s assumptions, shifts in aggregate demand have persistent effects on GDP

Returns on wealth exceed growth for more countries, more years, and more dramatically than Piketty has found

The Chinese property market may finally be boiling over; there are certainly enough signs that the bubble is ready to burst.

By pushing workers into precarious, part-time work, “Third Way” governments of the past 20 years helped to create the disturbing economic trend that’s vexing orthodox economists

This research project studies the evolution of monetary policy since the financial crisis, as regards to changes in implementation mechanisms and use of conventional/unconventional instruments of monetary policy, as well as its mpact on macroeconomic variables, including income distribution.

When an economic model fails, it is reality—and the people living in it—who pay the bills while the model lives on, unscathed.

Pisani-Ferry discusses the challenges facing the creation of a common monetary union in the form that was eventually agreed in the 1990s absent a political union.

How can we reconnect economic success to socioeconomic outcomes?

Phenomenal World

Salaries in the U.S. aren’t keeping up with inflation, despite pandemic-related increases in some sectors. That’s a major threat to the future for all working Americans – especially the youngest.

One thing is now certain about the upcoming presidential election in the United States: the next president will not be a committed free trader.

The recent financial crisis has impressively illustrated the dangers of rapid credit growth in a painful way.

Bill Mitchell presents a coherent analysis of how money is created, how it functions in global exchange rate regimes, and how the mystification of the nature of money has constrained governments, and prevented states from acting in the public interest.

Italy’s austerity-fueled crisis is a warning to the Eurozone

Servaas Storm has conviction, yet his analysis throws the baby out with the bathwater.

Vera Songwe, Chair of the Liquidity and Sustainability Facility, and former Executive Secretary of the UN Economic Commission for Africa, on the multiple crises facing African countries.

Because global warming doesn’t take a holiday

Without new economic thinking, macro policy will retain its deflationary biases and secular stagnation remains the ‘normal’.

The view from BIS

Increasing evidence that the IRA is probably not harming pharmaceutical innovation.

Medicare Needs a Perspective on “Collective and Cumulative Learning” in Inflation Reduction Act Negotiations

Sheila Dow and Antonella Stirati bring their scholarly expertise to INET’s research advisory group

How do governments accumulate such high levels of debt without constant major crises? Who is paying the price?

An interview with Gilles Yabi, executive director of the West African Think Tank WATHI, on food security in Africa

Behind bogus promises of job creation and economic growth lies a dangerous agenda to shred social safety nets.

Lance Taylor and Özlem Ömer respond to Andrew Smithers’s final comment on their working paper

A Template to Prevent a Global Debt Crisis?

Beijing’s leaders face a critical dilemma over a credit boom that imperils China’s prospects for a smooth transition to a sustainable economic path

Comments on “German Wage Moderation and the Eurozone Crisis: A Critical Analysis” by Servaas Storm

A minimum wage is a small minnow in an ocean of deficient aggregate demand

More on substance, coherence, and relevance in the Eurozone debate.

On the occasion of the ASSA 2021 Virtual Annual Meeting (Jan. 3-5), Peter Bofinger presents a “10 Best of” Mankiw list

It is high time to ditch this myth for at least the following five reasons.

Research by INET-affiliated scholars shows the US lags far behind its peers on inclusive growth, suggesting inequality is not an inevitable consequence of globalization and technology

Exploring the genesis of an important work, one that critiques mainstream neoclassical economics and offers an alternative framework for understanding modern economies.

What does America need?

The economy is likely to be crippled for months and fiscal rescue on a large scale, once again, is very much necessary.

COVID has meant unemployment for the many and a corporate profit-fueled windfall for the few.

Democratic capitalism is an evolving system that responds to crises by radically transforming both economic relations and political institutions. The time for a new phase has come, regardless of whether “responsible” politicians are prepared to admit it.

In the global super election year of 2024, populists are threatening to experience a new upswing almost everywhere – whether in the USA, the EU or in East Germany. What makes so many citizens so dissatisfied? What could help win people back and restore their trust in liberal democracy?

Faced with a shrinking list of options to trim the budget, Republicans are now eyeing Medicaid - but will that fly among Trump supporters?

Cecilia Nahon, Argentina’s Ambassador to Washington, DC., discusses the issues plaguing the Argentine government in it’s attempts to conclude debt restructuring.

INET Research on Financial Sector Weakness and Too Big to Fail

The tail risks that may be generated by Mario Draghi’s monetary policy innovations in the Eurozone include even more intense versions of Andrew Haldane’s “Doom Loops”

INET’s Research Director Thomas Ferguson talks about the research he and his collaborators Paul Jorgensen and Jie Chen conducted of the 2020 election and some of overlooked factors that were at play in that election.

Some years ago, in the aftermath of the “great financial crisis” (GFC) of the first decade of the twentieth century, Paul Krugman famously remarked that “most macroeconomics of the last thirty years was spectacularly useless at best and positively harmful at worst”. It is the premise of this set of lectures that it is possible to do better, much better.

This year’s New Hampshire primary testifies to the disintegration of the Republican Party

Economic sanctions against Russia are adding to a major redistribution of income from workers and middle-class consumers to profits in international trade.

Veteran researcher sheds light on what’s going on, how long the pain might last, and possible paths forward.