Viral Acharya, Matthew Richardson , Stijn Van Nieuwerburgh, Lawrence White, 12 May 2011

At the centre of the global financial crisis was a housing boom and bust. This column continues the description of how flaws in the US housing finance sector made the crisis inevitable. Here the authors outline a reform plan to avoid this outcome and contrast it to the US Treasury proposals.

Viral Acharya, Matthew Richardson , Stijn Van Nieuwerburgh, Lawrence White, 11 May 2011

At the centre of the global financial crisis was a housing boom and bust. A New York University team has produced an excellent book on the flaws in the design of US housing finance that opened the door for the mayhem that followed. This column, the first of a series of two, describes the race to the bottom that occurred among Fannie Mae, Freddie Mac, and the too-big-to-fail private financial institutions.

Uri Dadush, Bennett Stancil, 09 May 2011

Between 2000 and 2009, developing countries added almost $5 trillion to their foreign-exchange reserves – a number deemed too high by many, prompting accusations of protectionism. But this column argues that developed countries are equally to blame – as well as failures in international coordination. It concludes that remedies therefore require action by both groups.

Paolo Surico, Kanishka Misra, 06 May 2011

What are the macroeconomic effects of a tax rebate? This column takes a novel approach by estimating the effects on a range of different individuals rather than just the typical person. Looking at the 2001 income tax rebates in the US, it finds evidence of a heterogeneous response to tax cuts and an economic effect $9 billion below what linear models suggest.

Anne Krueger, 28 April 2011

The Doha Round is in peril. This essay argues that if the impasse is intractable, world leaders face three choices: to quickly finish the low-ambition package on the table, to explicitly terminate the Doha Round, or to let it die a slow death. It says the last option would be by far the worst – even if it is the most likely.

Philip Levy, 28 April 2011

The Obama Administration seems to view Doha delay as a minor issue since they view the export gains from the current package as small. This column argues that this calculation is based on a false premise that the status quo would continue even if the Round dragged on for years. Nations respect the WTO’s Dispute Settlement Mechanism verdicts in order to remain as members in good standing; this allows them to reap the benefits of the WTO as a negotiating forum. If the WTO collapses as a negotiating forum, nations may move towards a crass calculus that assesses verdicts only on the basis of the threats that back them. This would be a deeply regrettable move away from a rules-based global trading regime.

Antonello D’Agostino, Paolo Surico, 18 April 2011

What does inflation predictability reveal about the conduct of monetary policy? This column examines the ability of money growth and output growth to forecast inflation across a century of US data. It uncovers a robust link between the nature of the monetary regimes and the ability to predict inflation several quarters ahead.

Yuqing Xing, 10 April 2011

What can the iPhone tell us about the trade imbalance between China and the US? This column argues that current trade statistics greatly inflate the value of China’s iPhone exports to the US, since China's value added accounts for only a very small portion of the Apple product's price. Given this, the renminbi’s appreciation would have little impact on the global demand for products assembled in China.

Eric Bartelsman, Pieter Gautier, Joris de Wind, 28 March 2011

Why is the US more productive than the EU? Many studies have shown that the wider use of information and communication technologies in the US explains much of the difference. Why does the US use these technologies more? This column provides new evidence suggesting the answer may lie in differences in employment protection legislation.

Heleen Mees, 24 March 2011

Is US easy monetary policy in the early 2000s to blame for the global saving glut? This column argues that the Federal Reserve’s policy triggered the refinancing boom and ensuing spending spree, which spurred economic growth and savings in China. The prolonged decline in long-term interest rates in the mid-2000s is largely to blame for the housing boom in the US.

James Heckman, 20 March 2011

Disparities between Blacks and Whites are a persistent feature of American society. This column shows that problems facing African Americans are shared by many other groups and stem from shortfalls in skills. It argues that the most helpful and cost-effective policy to enhance the skills of disadvantaged children is support for parenting. The early years of a child’s life lay the foundation for all that follows.

Uri Dadush, Vera Eidelman, 06 March 2011

Global imbalances and their effects on the global economy are much discussed. This column says that discussing global imbalances is popular because it is the easy way out. It says that policymakers should target the illness rather than the symptoms by reforming their domestic economies and focusing on sustainable growth.

Helmut Reisen, Moritz Schularick, Marcus Kappler, Edouard Turkisch, 02 March 2011

If China only allowed its currency to appreciate, the global economy would rebalance and stabilise – or so the argument goes. This column studies the historical record of large exchange-rate revaluations. It supports the idea that currency appreciations have an impact on the current account but argues that this can come at a cost – the reduction in exports risks putting the brakes on global growth.

Uri Dadush, Vera Eidelman, 26 February 2011

Reform of the international monetary system tops France’s agenda as G20 chair. But what is it about the international monetary system that needs to change? This column says that the exchange-rate system is in relatively good shape.

Eleonora Patacchini, Yves Zenou, 25 February 2011

Most people agree that friends matter – not just for personal wellbeing but for achieving their goals in life. Several studies have shown this to be particularly the case in education but the detection and measure of such peer effects is often found wanting. Using detailed information on friendship networks of American high-school students, this column finds that the friends we make at age 15 to 18 have a strong and persistent effect on our lives.

Raphael Auer, 21 February 2011

This column says that low US inflation over the last 15 years is partly attributable to cheap Chinese imports. It argues that if the US trade deficit is reduced – via either Chinese inflation or a nominal appreciation of the renminbi – this disinflationary effect will be reduced. It says that the resulting inflationary impulse could be severe.

Ivan Cherkashin , Svetlana Demidova , Hiau Looi Kee, Kala Krishna, 19 February 2011

Trade preferences, such as those removing restrictions on Madagascar’s exports to the US, have long been a controversial policy. Some argue that it removes incentives for firms to become more competitive as they simply divert their trade to the preferred market. This column argues using counterfactual simulations that trade preferences can increase trade for the provider country, the receiver country, and other trading partners as well.

Domingo Cavallo, Fernando Díaz, 17 February 2011

With growing inflation in China, policymakers are facing tough decisions. This column argues that if the government is to curb inflation without allowing for the deflation of the tradables, it should do so though sector focused policies. Monetary policy is already committed to the objective of preventing deflation of the tradables and to dampen the credit cycle that is behind asset bubbles.

Avinash Persaud, 16 February 2011

Criticism of China’s exchange-rate policy continues throughout the US. This column argues that the US is in fact the exchange rate manipulator, due to its ongoing quantitative easing. What the US needs to do for a sustainable turnaround is to learn from other successful economies like China and Germany – not de-rail them.

Leah Boustan, Robert Margo, 12 February 2011

Economists and sociologists have long maintained that mass movement of whites to US suburbs harmed remaining inner city residents by reducing the tax base and fostering isolated racial enclaves. This column argues that white suburbanisation had a silver lining – it indirectly contributed to the rise in black homeownership.

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