Global economy

Rui Esteves, 15 February 2019

A new data set compiles the history of international finance spanning a century and a half, revealing new information about globalisation, crises and capital flows. Rui Esteves of the Graduate Institute, Geneva, tells Tim Phillips what lessons it offers for policymakers today.

Antoine Berthou, Caroline Jardet, Daniele Siena, Urszula Szczerbowicz, 08 February 2019

Escalating tensions between the US and its trading partners have made a global trade war more likely. In addition to the direct effect due to the increase in tariffs, a trade war may also affect GDP via indirect channels, such as a drop in productivity due to uncertainty and changes in the production environment. Using a multi-country model, this column shows that a global and generalised 10 percentage point increase in tariffs could reduce the level of global GDP by almost 2.0% on impact and up to 3.0% after two years, when all the additional indirect channels materialise. 

Kevin O'Rourke, 01 February 2019

Trade growth is slowing down. But is it, as the media and populist politicians claim, the end of globalisation? Kevin O'Rourke tells Tim Phillips how economic history can answer the question, and what we can learn from the history of global trade.

José L. Fillat, Stefania Garetto, Arthur V. Smith, 30 November 2018

How relevant are global banks in the transmission of shocks across countries? This column discusses the effects that the presence of foreign banking institutions has on the transmission of shocks during crises. Using a model that microfounds a bank’s decision on whether and how to expand into foreign markets, it quantifies the extent of shock transmission and examines the effects of counterfactual regulatory and monetary policies across borders. 

Hites Ahir, Nicholas Bloom, Davide Furceri, 29 November 2018

The global economy is growing, but so is uncertainty. This column presents a new quarterly index of uncertainty for 143 countries. The World Uncertainty Index reveals how uncertainty in the world has evolved over time, whether it is synchronised across countries, and how it compares across income groups and political regimes.

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