Found 472 article(s) in category 'Fiscal Policy'

Understanding and improving the one and three times GDP per capita cost-effectiveness thresholds

Understanding and improving the one and three times GDP per capita cost-effectiveness thresholds. James Robinson, June 18, 2016, Paper, “Researchers and policymakers have long been interested in developing simple decision rules to aid in determining whether an intervention is, or is not, cost-effective. In global health, interventions that impose costs per disability-adjusted life year averted less than three and one times gross domestic product per capita are often considered cost-effective and very cost-effective, respectively. This article explores the conceptual foundation and derivation of these thresholds. Its goal is to promote understanding of how these thresholds were derived and their implications, as well as to suggest options for improvement.Link

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Reducing Long Term Deficits

Reducing Long Term Deficits. Martin Feldstein, May 26, 2016, Paper. “The most serious long-term challenge for the economic policy of the US Federal government is the explosive growth of the national debt that will occur unless there are specific policy actions. The ratio of the federal government debt to the GDP has doubled in the past decade from a level of less than 40 percent that prevailed for many years before the recent recession to 75 percent of GDP now. According to the most recent report by the Congressional Budget Office (2016), the debt ratio is already beginning to rise. The CBO projects that with current policies the debt to GDP ratio will reach 86 percent within ten years and the federal debt will be on its way to 155 percent of GDP by the year 2045. I suspect that even this disturbing forecast is too optimistic because a debt trajectory like that is likely to cause portfolio investors in the United States and elsewhereto conclude that the U.S. government has lost control of its fiscal policy …” Link

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Connectedness and Contagion: Protecting the Financial System from Panics

Connectedness and Contagion: Protecting the Financial System from Panics. Hal Scott, May 2016, Book. “The Dodd–Frank Act of 2010 was intended to reform financial policies in order to prevent another massive crisis such as the financial meltdown of 2008. Dodd–Frank is largely premised on the diagnosis that connectedness was the major problem in that crisis—that is, that financial institutions were overexposed to one another, resulting in a possible chain reaction of failures. In this book, Hal Scott argues that it is not connectedness but contagion that is the most significant element of systemic risk facing the financial system. Contagion is an indiscriminate run by short-term creditors of financial institutions that can render otherwise solvent institutions insolvent. It poses a serious risk because, as Scott explains, our financial system still depends on approximately $7.4 to $8.2 trillion of runnable and uninsured short-term liabilities, 60 percent of which are held by nonbanks.Link

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Rediscovering Fiscal Policy at the G7

Rediscovering Fiscal Policy at the G7. Jeffrey Frankel, May 24, 2016, Opinion. “As G7 leaders convene in Ise-Shima, Japan, the global economy’s fragility is a top concern. But instead of focusing on currency wars, the leaders of the major developed economies should be discussing fiscal policy, which under current conditions would be a more powerful tool than monetary policy for boosting economic activity. After all, today, unlike in normal times, the effects of fiscal policy would not be limited by too-high interest rates, inadequate private demand, strict capacity constraints, or excessive inflation.Link

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Microeconomics of Competitiveness Financial Services Cluster in Lima – Final Report

Microeconomics of Competitiveness Financial Services Cluster in Lima – Final Report. Laura Alfaro, May 6, 2016, Paper. “Since gaining independence from the Spanish Empire in 1824, Peru has had a long history of dictatorships and military coups. Only in the 1980s did the country achieve a peacefully elected democracy. Since that time, in spite of pressure from fringe, armed political groups like the “Shining Path”, the country has managed thirty-six years (and counting) of stable democracy. The country today exists as a constitutional republic with a unicameral legislature, and there are roughly eight active political parties at the national stage1 (parties coalesce and diverge as coalitions form and break apart from vote to vote).Link

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The Market for Creampuffs: Big Data and the Transformation of the Welfare State

The Market for Creampuffs: Big Data and the Transformation of the Welfare State. Torben Iversen, April 2016, Paper. “The literature on the welfare state assumes, often implicitly but almost universally, that social insurance can or will be provided through the state. This assumption is based on economic models of insurance that show the propensity for market failure when information is limited and privately held. With the data revolution this is no longer a satisfactory approach, and this paper asks what happens when information rises and can be credibly shared with insures. Our model shows that Big Data alters the politics of social insurance by increasing polarization over the level and cost-sharing of public provision, and sometimes by creating majorities for a shift towards segmented and inegalitarian private markets (a shift that is conditioned by government partisanship).Link

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Financing High-Potential Entrepreneurship

Financing High-Potential Entrepreneurship. Ramana Nanda, April 2016, Paper. “Entrepreneurship is essential to job creation and to productivity growth and therefore is an important matter for government policy. However, policymakers face a difficult challenge because successful growth for a few firms—which cannot easily be identified in advance—is accompanied by widespread failure for most other new firms. Predicting which firms will fail and which will succeed is nearly impossible. Instead of futilely trying to pick winners, governments can play a useful role in facilitating the growth of the most promising firms by setting the conditions for efficient trial-and-error experimentation across firms.Link

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Larry Summers: The prospect of Donald Trump being president is the gravest threat to America

Larry Summers: The prospect of Donald Trump being president is the gravest threat to America, April 14, 2016, Video. “Former Treasury Secretary Larry Summers spoke at the International Monetary Fund on Wednesday, warning against austerity measures amid a tepid economy.  Yahoo Finance sat down with him to get little more color on the economy and to find out what keeps him up most at night.  “I think the prospect of Donald Trump being President would be the gravest threat to our prosperity, our security, and our freedom in my adult lifetime,” Summers said. “That’s the thing I would worry most about.”Link

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Billionaires against Big Business: Growing Tensions in the Republican Party Coalition

Billionaires against Big Business: Growing Tensions in the Republican Party Coalition. Theda Skocpol, April 8, 2016, Paper. “As the Republican Party has shifted further to the right, policy battles have broken out between business associations and conservative groups. We use data from Congressional scorecards issued between 2007 and 2014 to analyze areas of policy divergence and convergence between two major organized players in the GOP coalition: the U.S. Chamber of Commerce and the increasingly comprehensive and assertive political network orchestrated by libertarian multibillionaires Charles and David Koch. We show that policy splits have widened and pinpoint the issue areas where free-market advocacy by the Koch network converges with or differs from the business-friendly menu of policies promoted by the U.S. Chamber. Our findings inform research on ideological polarization and associated shifts in party coalitions. They also illuminate the political reverberations of rising economic inequality, making it clear that the goals and strategies of very wealthy individuals may not be fully aligned with those pursued by business associations.Link

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Competitiveness and Growth Policy Design

Competitiveness and Growth Policy Design. Philippe Aghion, March 22, 2016, Book Chapter. “After decades during which governments in developed countries would privilege domestic demand as a main driver of economic growth, the advent of globalisation has forced governments to increasingly turn their attention to the competitiveness of the domestic economy, i.e. the extent to which a country can export its production abroad and thereby ‘exchange goods and services in which it is abundant for goods and services that it lacks’.Link

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