Home

Research-based policy analysis and commentary from leading economists

Create account | Login | Subscribe

Search form

  • Columns
    • By Topic
    • By Date
    • By Reads
    • By Tag
  • Covid-19
    • Economics in the Time of Covid-19
    • Mitigating the COVID Economic Crisis
    • Covid Economics
  • Vox Multimedia
    • Video Vox
    • VoxTalks
  • Publications
    • Books
    • CEPR Reports
    • Policy Insights
  • Blogs&Reviews
  • People
    • A
    • B
    • C
    • D
    • E
    • F
    • G
    • H
    • I
    • J
    • K
    • L
    • M
    • N
    • O
    • P
    • Q
    • R
    • S
    • T
    • U
    • V
    • W
    • X
    • Y
    • Z
  • Debates
    • Economics in the Time of Covid-19
    • Populism
    • WWII
    • Digital Money
    • Euro Area Reform
  • Events
    • Workshops & Conferences
    • Courses
    • Discussion Meetings
    • Submit an Event
  • About
    • About Vox
    • Help
    • Subscribe
    • Contact

Most Read: All Time

A tale of two depressions: What do the new data tell us? February 2010 update

Eichengreen, O'Rourke, 08 March 2010

This column updates the original Vox columns by Barry Eichengreen and Kevin O’Rourke comparing today’s global crisis to the Great Depression. The three previous columns have shattered all Vox readership records with over 450,000 views. This latest edition covers up to February 2010 showing that, while there is cause for optimism, there is no room for complacency.

The impact of COVID-19 on education

Burgess, Sievertsen, 01 April 2020

The global lockdown of education institutions is going to cause major (and likely unequal) interruption in students’ learning; disruptions in internal assessments; and the cancellation of public assessments for qualifications or their replacement by an inferior alternative. This column discusses what can be done to mitigate these negative impacts.

Unmasked! The effect of face masks on the spread of COVID-19

Mitze, Kosfeld, Rode, Wälde, 22 June 2020

Confronted with a novel, aggressive coronavirus, Germany implemented measures to reduce its spread since March 2020. Requiring people to wear face masks in public places has, however, been a subject of controversy and isolating the effect of mask-wearing on the spread of COVID-19 is not simple. This column looks at the town of Jena and other German regions that introduced face masks before the rest of the country to see whether the requirement makes a difference in the number of new COVID-19 cases. Requiring face masks to be worn decreases the growth rate of COVID-19 cases by about 40% in Germany.

Colonialism and development in Africa

Heldring, Robinson, 10 January 2013

Most of Africa spent two generations under colonial rule. This column argues that, contrary to some recent commentaries highlighting the benefits of colonialism, it is this intense experience that has significantly retarded economic development across the continent. Relative to any plausible counterfactual, Africa is poorer today than it would have been had colonialism not occurred.

Eurozone breakup would trigger the mother of all financial crises

Eichengreen, 04 May 2010

Originally posted 17 November 2007, this Vox column is more relevant than ever arguing that adopting the euro is effectively irreversible. Leaving would require lengthy preparations, which, given the anticipated devaluation, would trigger the mother of all financial crises. National households and firms would shift deposits to other Eurozone banks producing a system-wide bank run. Investors, trying to escape, would create a bond-market crisis. Here is what the train wreck would look like.

Panic-driven austerity in the Eurozone and its implications

De Grauwe, Ji, 21 February 2013

Eurozone policy seems driven by market sentiment. This column argues that fear and panic led to excessive, and possibly self-defeating, austerity in the south while failing to induce offsetting stimulus in the north. The resulting deflation bias produced the double-dip recession and perhaps more dire consequences. As it becomes obvious that austerity produces unnecessary suffering, millions may seek liberation from ‘euro shackles’.

Educated in America: College graduates and high school dropouts

Heckman, LaFontaine, 13 February 2008

Official statistics for US high school graduation rates mask a growing educational divide. This column presents research showing that a record number of Americans are going to university – while an increasing number are dropping out of high school. This poses major social challenges for the United States.

Debt, deleveraging, and the liquidity trap: A new model

Krugman, 18 November 2010

Debt is the crux of advanced economies’ current policy debates. Some argue for fiscal expansion to avoid recession and deflation. Others claim that you can’t solve a debt-created problem with more debt. This column explains the core logic of a new model by Eggertsson and Krugman in which debt shocks and policy reactions can be examined. Relying on heterogeneous agents, the model naturally produces the paradox of thrift but also finds new supply-side paradoxes, those of toil and flexibility. The model suggests that most economists have been misthinking the issues and that actual policy in the US and EU is misguided.

Why was the Industrial Revolution British?

Allen, 15 May 2009

It is still not clear among economic historians why the Industrial Revolution actually took place in 18th century Britain. This column explains that it is the British Empire’s success in international trade that created Britain’s high wage, cheap energy economy, and it was the spring board for the Industrial Revolution.

The economic impact of colonialism

Acemoğlu, Robinson, 30 January 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 long-run effects of the Scramble for Africa

Michalopoulos, Papaioannou, 06 January 2012

The 'Scramble for Africa' – the artificial drawing of African political boundaries among European powers in the end of the 19th century – led to the partitioning of several ethnicities across newly created African states. This columns shows that partitioned ethnic groups have suffered significantly longer and more devastating civil wars. It also uncovers substantial spillovers as ethnic conflict spreads from the historical homeland of groups partitioned to nearby areas where non-split ethnicities reside.

Understanding the long-run effects of Africa’s slave trades

Nunn, 27 February 2017

Evidence suggests that Africa's slave trades played an important part in the shaping of the continent not only in terms of economic outcomes, but cultural and social outcomes as well. This column, taken from a recently published VoxEU eBook, summarises studies that reveal the lasting toxic effects of Africa’s four waves of slave trades on contemporary development.

Information technology and economic change: The impact of the printing press

Dittmar, 11 February 2011

Despite the revolutionary technological advance of the printing press in the 15th century, there is precious little economic evidence of its benefits. Using data on 200 European cities between 1450 and 1600, this column finds that economic growth was higher by as much as 60 percentage points in cities that adopted the technology.

Slave trade and African underdevelopment

Nunn, 08 December 2007

Slavery, according to historical accounts, played an important role in Africa’s underdevelopment. It fostered ethnic fractionalisation and undermined effective states. The largest numbers of slaves were taken from areas that were the most underdeveloped politically at the end of the 19th century and are the most ethnically fragmented today. Recent research suggests that without the slave trades, 72% of Africa’s income gap with the rest of the world would not exist today.

Are Germans really poorer than Spaniards, Italians and Greeks?

De Grauwe, Ji, 16 April 2013

A recent ECB household-wealth survey was interpreted by the media as evidence that poor Germans shouldn’t have to pay for southern Europe. This column takes a look at the numbers. Whilst it’s true that median German households are poor compared to their southern European counterparts, Germany itself is wealthy. Importantly, this wealth is very unequally distributed, but the issue of unequal distribution doesn’t feature much in the press. The debate in Germany creates an inaccurate perception among less wealthy Germans that transfers are unfair.

Secular stagnation: Facts, causes, and cures – a new Vox eBook

Teulings, Baldwin, 10 September 2014

The CEPR Press eBook on secular stagnation has been viewed over 80,000 times since it was published on 15 August 2014. The PDF remains freely downloadable, but as the European debate on secular stagnation is moving into policy circles, we decided to also make it a Kindle book. This is available from Amazon; all proceeds will help defray VoxEU expenses.

Failing banks and Hitler's path to power

Doerr, Peydró, Voth, 15 March 2019

Polarised politics in the wake of financial crises echo throughout modern history, but evidence of a causal link between economic downturns and populism is limited. This column shows that financial crisis-induced misery boosted far right-wing voting in interwar Germany. In towns and cities where many firms were exposed to failing banks, Nazi votes surged. In particular, places exposed to the one bank led by a Jewish chairman registered particularly strong increases of support – scapegoating Jews was easier with seemingly damning evidence of their negative influence.  

Economic crisis in Europe: Cause, consequences, and responses

Székely, van den Noord, 06 October 2009

The European economy is in its deepest recession since the 1930s. This column says that swift policy response avoided a financial meltdown, but turning the ongoing recovery into sustained growth requires action on five challenges: boosting potential output, enhancing labour market flexibility, preparing fiscal consolidation, facilitating intra-EU adjustment, and unwinding global imbalances. Europe also needs an improved crisis-management framework, lest this happen again.

What’s your (sur)name? Intergenerational mobility over six centuries

Barone, Mocetti, 17 May 2016

Societies characterised by a high transmission of socioeconomic status across generations are not only more likely to be perceived as ‘unfair’, they may also be less efficient as they waste the skills of those coming from disadvantaged backgrounds. Existing evidence suggests that the related earnings advantages disappear after several generations. This column challenges this view by comparing tax records for family dynasties (identified by surname) in Florence, Italy in 1427 and 2011. The top earners among the current taxpayers were found to have already been at the top of the socioeconomic ladder six centuries ago. This persistence is identified despite the huge political, demographic, and economic upheavals that occurred between the two dates. 

The effects of school-starting age

Black, Devereux, Salvanes, 21 June 2008

Do children do better if they start school later? Contrary to the great concerns of many parents, this column says that the age at which kids start school matters little.

Trade and inequality, revisited

Krugman, 15 June 2007

It’s no longer safe to assert that trade’s impact on the income distribution in wealthy countries is fairly minor. There’s a good case that it is big, and getting bigger. I’m not endorsing protectionism, but free-traders need better answers to the anxieties of globalisation’s losers.

The greatest reshuffle of individual incomes since the Industrial Revolution

Milanovic, 01 July 2016

The effects of of globalisation on income distributions in rich countries have been studied extensively. This column takes a different approach by looking at developments in global incomes from 1988 to 2008. Large real income gains have been made by people around the median of the global income distribution and by those in the global top 1%.  However, there has been an absence of real income growth for people around the 80-85th percentiles of the global distribution, a group consisting of people in ‘old rich’ OECD countries who are in the lower halves of their countries’ income distributions.

Britain’s EU membership: New insight from economic history

Campos, Coricelli, 03 February 2015

Britain eschewed EU membership in the late 1950s but changed its mind in the early 1960s, only to be rebuffed by Charles de Gaulle. Membership came only in the early 1970s. This column argues that, among others, Britain joined the EU as a way to avoid its economic decline. The UK’s per capita GDP relative to the EU founding members’ declined steadily from 1945 to 1972. However, it was relatively stable between 1973 and 2010. This suggests substantial benefits from EU membership especially considering that, by sponsoring an overpowered integration model, Britain joined too late, at a bad moment in time, and at an avoidably larger cost.

100 years of US obesity

Komlos, Brabec, 31 August 2010

More than one billion adults across the globe are overweight, and at least 300 million are clinically obese. This column argues that the obesity epidemic in the US has been creeping up throughout the twentieth century, much earlier than the official account acknowledges. Current US standards thereby mislead many overweight and obese youth into believing that their weight is normal when it is not.

Taxing the 1%: Why the top tax rate could be over 80%

Piketty, Saez, Stantcheva, 08 December 2011

The top 1% of US earners now command a far higher share of the country's income than they did 40 years ago. This column looks at 18 OECD countries and disputes the claim that low taxes on the rich raise productivity and economic growth. It says the optimal top tax rate could be over 80% and no one but the mega rich would lose out.

Overweight adolescents and risky sexual behaviour

Corman, Reichman, Averett, 06 August 2010

Obesity and teenage sex have become social and public health issues in developed countries. This column looks at the effects of being overweight on attitudes to sex among teenage girls in the US. While obesity is associated with less vaginal intercourse, overweight teenage girls are at least 15% more likely to have had anal sex, with a high chance of sexually transmitted disease.

The impact of AI and information technologies on worker stress

Yamamoto, 14 March 2019

The adoption of new information technologies such as AI in more workplaces is influencing not just employment and wages, but worker well-being such as job satisfaction, stress, and health. Surveying approximately 10,000 workers in Japan, this column analyses the impact of new information technologies on the nature of tasks performed by workers, job satisfaction, and work-related stress. It finds that AI adoption contributes to both greater job satisfaction and increased stress, and considers approaches to maximise the positives of new technologies adoption while minimising its negative side effects.

What caused the recession of 1937-38? A new lesson for today’s policymakers

Irwin, 11 September 2011

The swift policy response to the recent financial crisis helped the world economy avoid a replay of the Great Depression of 1929-32. But can we avoid a replay of 1937-38? With the world economy weakening once again, this column addresses the question with a renewed urgency and comes up with an oft-overlooked explanation – the Treasury Department's decision to sterilise all gold inflows starting in December 1936.

Does climate change affect economic growth?

Jones, Olken , Dell, 06 June 2009

Hot countries tend to be poorer, but debate continues over whether the temperature-income relationship is simply a happenstance association. This column uses within-country estimates to show that higher temperatures have large, negative effects on economic growth – but only in poor countries. The findings are big news for future global inequality.

The geopolitics of bilateral trade agreements

Eichengreen, Mehl, Chiţu, 14 March 2019

Both economics and geopolitics matter for trade agreements. In particular, defence pacts raise the probability of a trade agreement between a pair of countries by as much as 20 percentage points. This column estimates that were the US to alienate its geopolitical allies, the likelihood and benefits of successful bilateral agreements would diminish significantly. Expected trade creation from an agreement between the US and EU countries would decline by 0.6% of total US exports.

Parametric estimations of the world distribution of income

Sala-i-Martin, Pinkovskiy, 22 January 2010

World poverty is falling. This column presents new estimates of the world’s income distribution and suggests that world poverty is disappearing faster than previously thought. From 1970 to 2006, poverty fell by 86% in South Asia, 73% in Latin America, 39% in the Middle East, and 20% in Africa. Barring a catastrophe, there will never be more than a billion people in poverty in the future history of the world.

Work of the past, work of the future

Autor, 19 March 2019

Labour markets in US cities today are vastly more educated and skill-intensive than they were 50 years ago, but urban non-college workers now perform much less skilled work than they did. This column shows that automation and international trade have eliminated many of the mid-skilled non-college jobs that were disproportionately based in cities. This has contributed to a secular fall in real non-college wages.

Women’s liberation as a financial innovation

Hazan, Weiss, Zoabi, 23 March 2019

Countries such as England, the US, Canada, and Australia granted property rights to married women in the 19th century. The column uses US census and economic data from the time to show that the impact was financial as well as social. Women kept more of their assets as cash in US states that granted these rights. This reduced interest rates and accelerated industrialisation in these regions.

Monetary policy in times of uncertainty

Ferrero, Pietrunti, Tiseno, 21 March 2019

Dealing with uncertainty about the state of the economy is one of the main challenges facing monetary policymakers. In recent years there has been an extensive debate on the value of some of the deep parameters driving the economy, such as the natural rate of interest and the slope of the Phillips curve, estimates of which are quite uncertain. This column argues that when facing uncertainty on the structural relationship among macroeconomic variables, central banks should adopt a pragmatic and data-dependent approach to adjusting their monetary policy stance. 

The effect of board reform on the gender gap in firms

Maida, Weber, 15 March 2019

Mandated gender quotas in Italy have been successful at increasing the number of women on boards. But the relevant law is temporary and affects only a small number of firms. The column uses evidence on employment and earnings to show no increase in female representation at the top executive level or among top earners. This may be because norms and perceptions take time to change, or because newly appointed women in senior roles wield limited power.

Incarceration, unemployment, and the black–white marriage gap in the US

Caucutt, Guner, Rauh, 06 April 2019

In 2006, 67% of white women in the US between the ages of 25 and 54 were married, compared with only 34% of black women. This column examines the link between this and the decline in low-skilled jobs and the era of mass incarceration that have disproportionately affected black communities. It finds that differences in incarceration and employment dynamics between black and white men account for half of the black–white marriage gap.

Economic consequences of Covid-19: A multi-country analysis

Chudik, Mohaddes, Pesaran, Raissi, Rebucci, 19 October 2020

The Covid-19 pandemic is unprecedented in its global reach and impact, posing formidable challenges to policymakers and to the empirical analysis of its direct and indirect effects within the interconnected global economy. This column uses a ‘threshold-augmented multi-country econometric model’ to help quantify the impact of the Covid-19 shock along several dimensions. The results of the analysis show that the global recession will be long lasting, with no country escaping its impact regardless of their mitigation strategy. These findings call for a coordinated multi-country policy response to the pandemic.

Russia in the Great War: Mobilisation, grain, and revolution

Markevich, 09 March 2019

Prior to World War I, many authorities believed that countries with substantial agrarian sectors and grain exports, including the Russian Empire, could overcome war hardships more easily than those countries that imported grain. This column asks why the experts got it wrong in the case of Russia, and concludes that the economics and politics of the Russian grain and labour markets provide the answer. It was impossible simultaneously to mobilise 15 million males into the Russian army, procure the grain to feed them as soldiers, and avoid revolution. 

China overinvested in coal power: Here’s why

Ren, Branstetter, Kovak, Armanios, Yuan, 16 March 2019

Despite leading the world in clean energy investment in recent years, China continues to engage in massive expansion of coal power thanks to policies that effectively subsidise and (over)incentivise coal power investment. This column examines the effects of the 2014 devolution of authority from the central government to local governments on approvals for coal power projects. It finds that the approval rate for coal power projects is about three times higher when the approval authority is decentralised, and provinces with larger coal industries tend to approve more coal power.

Five decades of evidence on financial crisis and recession: How long? How deep?

Terrones, Kose, Claessens, 07 October 2008

The house and equity price busts on top of a credit crunch make this an unprecedented crisis for the modern US economy; its real economy effects are thus difficult to assess. This column provides insights based on evidence from 122 recessions in 21 advanced nations since 1960. Findings suggest recessions in such circumstances are much costlier and slightly longer. But the outcome can be affected by policy, and it’s high time that policymakers act swiftly and decisively.

The protectionist temptation: Lessons from the Great Depression for today

Eichengreen, Irwin, 17 March 2009

What do we know about the spread of protectionism during the Great Depression and what are the implications for today’s crisis? This column says the lesson is that countries should coordinate their fiscal and monetary measures. If some do and some don’t, the trade policy consequences could once again be most unfortunate.

Advertising as a major source of human dissatisfaction

Michel, Sovinsky, Proto, Oswald, 27 May 2019

Although the negative impact of conspicuous consumption has been discussed for more than a century, the link between advertising and individual is not well understood. This column uses longitudinal data for 27 countries in Europe linking change in life satisfaction to variation in advertising spend. The results show a large negative correlation that cannot be attributed to the business cycle or individual characteristics.

EU-UK global value chain trade and the indirect costs of Brexit

Cappariello, Mancini, Vergara Caffarelli, 22 March 2019

EU and the UK production networks are highly integrated, and Brexit poses a threat to supply and demand linkages between the two economies. This column describes how the effect of tariffs will be magnified due to back-and-forth trade across the Channel. This will increase production costs in the UK and, to a lesser extent, in the EU.

Revisiting the efficacy of the ECB’s balance sheet policies

Elbourne, Ji, Smid, 13 March 2019

Previous research has shown that changes to the size of the ECB’s balance sheet were followed by meaningful changes in macroeconomic aggregates. This column argues that the econometric technique these studies employed does not provide reliable estimates. Impulse responses to purported balance sheet shocks are statistically indistinguishable from those from nonsensical identification schemes. The effectiveness of the ECB’s balance sheet policies is therefore still unproven.

Black names: Past, present, and future

Cook, Logan, Parman, 13 November 2015

Much research has gone into trying to establish a connection in the US between having a distinctively black name and disadvantage over a lifetime. This column highlights a striking difference between the historical effects of having a black name and today’s effects. While modern black names show up in modern empirical studies as an albatross around the neck of those possessing them, either because those with such names come from worse socioeconomic conditions or face discrimination later in life, historical black names conveyed a large advantage accumulating over an individual’s lifetime.

Brexit delay will not postpone deglobalisation

van Bergeijk, 18 March 2019

Many associate Brexit and the Trumpian trade wars with the start of a new phase of deglobalisation. This column argues that we should view them as symptoms rather than causes, as the world had already started to fundamentally change before either came on the horizon. Neither the delay to Brexit nor the extended pause in the US–China tariff war means that the risks of deglobalisation have diminished.

Monetary policy and wage rigidity

Faia, Pezone, 12 March 2019

Policymakers are concerned about effecting real change with monetary policy, particularly in the context of wage rigidity. This column uses extensive Italian data to analyse the extent to which wage rigidity induced by collective bargaining amplifies the effects of monetary policy. The volatility of stock market returns reacts more to monetary policy announcements when the average time left before the renewal of the employees’ collective agreement is large.

Compliance and fairness in community-based taxation

Slivinski, Sussman, 20 March 2019

The problem of tax compliance is as old as the levying of taxes. Innovations in tax administration that induce high compliance rates at reasonable cost are extremely important to governments. This column demonstrates how the taille, a tax collection mechanism from medieval Paris, raised compliance by turning the social cost of tax evasion into a private one. It offers a tax collection model that is still relevant to governments today.

Subprime crisis: causes, consequences and cures

Reinhart, 15 March 2008

We may just have started to feel the pain. Asset price drops – including housing – are common markers in all the big banking crises over the past 30 years. GDP declines after such crises were both large (-2% on average) and protracted (2 years to return to trend); in the 5 biggest crises, the numbers were -5% and 3 years. This column, based on the author’s testimony to the Congress, picks through the causes and consequences. It argues that when it comes to ‘cures,’ it would be far better to get the job done right than get the job done quickly.

What’s wrong with the WTO’s Environmental Goods Agreement

de Melo, Solleder, 13 March 2019

Developing countries have not participated in the WTO-led negotiations aimed at bringing down barriers to trade in environmental goods. If negotiations conclude, would the win for trade and for the environment be extended to a win for developing countries? This column draws insights from a newly assembled comprehensive dataset on barriers to trade in environmental goods and provides evidence that tariffs and non-tariff barriers are still an impediment to trade while similar regulations stimulate it. A larger list of environmental goods would entice developing-country participation, but this will also require protecting developing countries from challenges at the WTO.