Industrialised and developing countries have differing fiscal strategies for dealing with the business cycle. But are countries’ strategies different according to whether they are industrialised? This column presents new evidence suggesting that the picture is complex. Procyclical fiscal policies remain the norm amongst most non-industrialised developing countries, but some key developing countries have recently moved toward a counter-cyclical stance as a result of strengthening institutions.
Japan was the first Asian nation to achieve modern economic growth. This column discusses new evidence suggesting that Japan’s growth started from a lower level than Britain’s and grew more slowly until the Meiji Restoration. The key to understanding modern economic growth seems to lie in identifying the forces that dampened growth reversals, rather than the forces responsible for growth itself.
Barry Eichengreen’s VoxEU column arguing that the euro was irreversible has been viewed over 230,000 times. Now it appears to be wrong. In this column, originally posted on the website ‘The Conversation’, he looks to see where his predictions went wrong. Basically the economic analysis – which focused on bank runs – was right. He went wrong in overestimating the political competence of Greece and its creditors.
Grexit and the reintroduction of the drachma would have severe consequences for the Greek people. This column argues, based on Argentina's experience, that this would produce a sharp devaluation of the drachma, inflation, and a severe reduction in real wages and pensions. The effects would be far worse than the reductions that could have occurred as a consequence of the policies proposed by the Troika. By resuming negotiations, continuing with measures to achieve fiscal consolidation and carrying out adequate structural reforms, Greece could reverse the current situation in a sustainable way. It has the great advantage that the ECB, most European governments and the IMF are willing to resume negotiations.
Economics in Europe has seen impressive growth in recent years. But European economic research still lags behind the US in terms of productivity. This column discusses a new research project, ‘COEURE’, that will study the state of economic research in Europe and the mechanisms by which it is funded.
Other Recent Columns:
- Sources of stock-market fluctuations: New evidence
- How do Japanese exporters manage their exchange rate exposure?
- Grexit: The staggering cost of central bank dependence
- Greece – the day after: Time for a fresh start
- Explaining the black-white wage gap
- Ancestry and culture
- Linkages and economic development
- Economic networks for more innovative and resilient economies
- Interpreting the yield curve: Pessimism or precaution?
- Trade and growth – end of an era?
- TPP now in sight
- Sutton-esque dominance in football
- Networking, context and firm-level innovation
- Optimal liquidity provision: Alternative views from the past
- Government spending multipliers and the business cycle
- Don’t sweat the debt if fiscal space is ample
- Measuring the health impact of airborne particulates
- City revivals and urban land premiums
- Recent Vox columns on the Greek Crisis
- VoxEU told you so: Greek Crisis columns since 2009