Policy Uncertainty Is Not Helping the US Economy

MEASURING UNCERTAINTY AND ITS EFFECTS The adverse economic effects of increased uncertainty have been analyzed and documented by Nicholas Bloom and others. Increased uncertainty can have a negative effect on short-run investment and hiring, and it may have been responsible for one-third of the decrease in GDP during the Great Recession (Bloom). Empirical measures of […]

What Should Be Done About Germany’s Current Account Surplus?

On November 13, the European Commission released the Alert Mechanism Report (AMR) for 2014 as part of its annual cycle for identifying and addressing macroeconomic imbalances (the so-called Macroeconomic Imbalance Procedure). Based on a scorecard of macroeconomic indicators with indicative thresholds, the AMR identifies those countries for which an in-depth review of potential macroeconomic imbalances and corresponding […]

Is It Time to Reform America’s Fiscal Institutions?

The United States government spends billions of dollars to protect against attacks by foreign military forces, terrorists, and natural disasters. However, earlier this month it was not prepared for a costly attack on the US economy by domestic forces in Washington: the Senate, the House, and the President. The government was shut down for 16 […]

To EU or not to EU: Eastern Partnership Countries at the Crossroads

In 2008 Poland and Sweden launched the European Union’s Eastern Partnership initiative. Its aim was to provide a venue for discussions on trade and other issues with the former Soviet Union states of Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine with the prospects of concluding Free Trade Agreements, liberalizing visa regimes and embracing other forms […]

The New World of Energy in the New World

THE OLD STORY The old story about energy in North America was a gloomy one.  The United States (and the world as a whole) had passed peak production, and it was running out of oil. Oil imports continued to increase, and the U.S. became increasingly dependent on Middle Eastern oil, which made it increasingly vulnerable […]

Detroit and the Federal Government: Can the U.S. Learn from Europe’s Mistakes?

Detroit Bankruptcy Bankruptcy by Detroit is the largest municipal bankruptcy in U.S. history. It is a shock for residents of Detroit and their creditors, and it could have important consequences for the fiscal policy of the entire country, depending on how the federal government reacts to it.  The municipal bankruptcy problem is bigger than Detroit, […]

Smithfield-Shuanghui Foods: Is It The Future For U.S.-China Relations?

Acquisition of Smithfield Foods by Shuanghui The Chinese firm, Shuanghui International has offered to buy the major pork producer, Smithfield Foods. The major shareholders of Smithfield, including Continental Grain, favor the offer, and the offer has been structured to appeal to current employees and management. The prospective owner promises no closing or relocation of present […]

Population Dynamics in the New EU Member States: It’s All About Relative Income Levels

The European Union added 10 new members in 2004 and two more in 2007. Recent population censuses have provided much more reliable data on the number of residents in the twelve new member states in 2011 than the regular estimates by the statistical offices. Together with data from previous censuses they allow evaluating the population […]

The Overdue U.S. Immigration Reform

Current Immigration Policy is Complex Of all possible economic reforms, the one most likely to increase incomes per person is to allow more people to move from where their productivity is low to where it is higher (Peri). Reform of immigration law is a timely topic in the United States, where a serious discussion of […]