Global economy

Christopher T. Stanton, Catherine Thomas, 03 November 2015

Outsourcing labour tasks to lower wage countries has been made much easier by the emergence of global online labour markets. This column argues that there are significant frictions in these markets, making it difficult for workers to get their first job and establish a reputation. However, new types of organisations have emerged that allow the sharing of reputations among groups of high-quality workers. These organisations seem to rely on offline social ties between workers to help reduce information-related trade barriers.

Maurice Obstfeld, 17 October 2015

In this column, the IMF's new Economic Counsellor and Director of Research presents the latest World Economic Outlook, which shows how the world economy is at the intersection of at least three powerful forces. First is China’s economic transformation away from export- and investment-led growth and manufacturing, in favour of a greater focus on consumption and services; second is the fall in commodity prices; and third is the impending normalisation of monetary policy in the US.

Barry Eichengreen, Donghyun Park, Kwanho Shin, 17 September 2015

Productivity growth is slowing around the world. The question is what lies behind this trend and whether it can be arrested. This column takes a historical perspective on total factor productivity growth slowdowns. International factors that heighten the risk of TFP slumps include global interest rate shocks, global oil price shocks and rising global risk aversion. Country-specific factors working in the same direction include low educational attainment, weak political systems, and overly high levels of investment. Investing in education, political development and rebalancing can mitigate the risk of TFP slumps but are unlikely to eliminate them entirely.

Andrew K Rose, 01 September 2015

A nation’s hard power is based on its ability to coerce, while its soft power depends on the attractiveness of its culture, political ideals, and policies. This column shows that a country’s soft power has measureable effects on its exports. Countries that are admired for their positive global influence export more, holding other things constant.

Kaoru Hosono, Daisuke Miyakawa, Miho Takizawa, 27 August 2015

‘Learning by exporting’ refers to productivity gains experienced by firms after they commence exporting. Such gains are argued to be due to access to new knowledge and resources. This column explores some of the preconditions for learning-by-exporting effects, using data on the overseas activities and affiliations of Japanese firms. Firms that enter markets in which they don’t have affiliates or subsidiaries are found to enjoy the most learning-by-exporting productivity gains. These findings have implications for the timing of new market entry.

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