Ed Dolan's Econ Blog

Roubini Topic Archive: Geostrategy

  • How Natural is Natural Monopoly? The Case of China’s Crumbling Hold on Rare Earths

    Rare earth elements (REEs) are a group of seventeen elements with exotic names like neodymium and yttrium that are key ingredients in many high-tech products, many important for national defense. Imagine the consternation of Western officials when they woke up one morning in September 2010 to learn that China held a near-monopoly in the production […]

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  • Ukraine’s Heavy Industry : Glittering Prize or White Elephant?

    According to some accounts, the conflict in Eastern Ukraine is a tug of war over the region’s mines, steel mills and other heavy industry. The website European Dialog, for example, tells us the region is “crucial to Russia,” which “values Ukraine because of industries, like steel and agriculture, that have served as vital inputs for […]

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  • Ten Years on, New Estimates of the Economic Cost of the Wars in Iraq and Afghanistan

    This week marks the tenth anniversary of the American invasion of Iraq. What have the wars in Iraq and Afghanistan cost the United States to date? What additional bills will come due in the future? Economists and budget analysts have made many estimates since the early 2000s. Only one regularity has emerged from their work: […]

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  • What Do the Russian Protesters Want? One Observer’s View of Problems and Needed Reforms

    Commentators have compared the recent Russian protests to those of Tahrir Square and Occupy Wall Street. There are differences, of course, but certain similarities stand out. For one thing, these recent movements differ from, say, Ukraine’s Orange Revolution, in that none of them has a clear leader. Instead, they have coalesced around negatives: Egypt without […]

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  • Afghanistan’s Economic Future, Aid, and the Curse of Riches

    We hear a lot about the future of Afghanistan after NATO withdrawal in 2014. Most of the speculation focuses on security and politics. Too little of it concerns economics. A pair of new reports, one from the World Bank and the other from the IMF, help fill the gap. If you thought the security and […]

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  • Why Rolling Back Environmental Protection is the Wrong Fix for Jobs

    Just when it seemed nothing could do it, persistently high U.S. unemployment has produced bipartisan agreement in Washington—agreement to roll back environmental protection in an attempt to save jobs and create new ones. The White House, shrugging off environmentalist opposition, has quashed a major EPA initiative that would have strengthened ozone regulations and is reportedly […]

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  • US Employment-Population Ratio Hits a New Low: Why it Matters for the Budget Debate

    By and large, U.S. media have spun the July employment report as more positive than negative. The 117,000 new payroll jobs created last month and the upward revisions for May and June were a relief after two months of very bad data. The downtick in the unemployment rate, although slight, was also welcome. One indicator […]

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  • Will Shifting Political Winds Finally Kill Ethanol Subsidies?

    As recently as last December, the coalition backing U.S. ethanol subsidies appeared to be alive and well, despite the fact that everyone knew they were bad for the environment, bad for energy efficiency, and bad for the budget. The largest subsidy, a tax credit for blending ethanol into gasoline, was set to expire at the […]

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  • Are Financial Regulators Flying Blind? Would Better “Risk Topography” Help?

    Data on the capital and liquidity of banks are the navigation aids that regulators depend on to avoid another financial crash. Improvements to these indicators, adopted last year by the Basel Committee on Bank Supervision, are among the most heralded regulatory reforms since the 2008 crisis. But what if the instruments are faulty, even in their upgraded form? If so, regulators are flying blind, and our chances of avoiding another crash are slim. What can be done?

    A recent paper by three prominent financial economists suggests one possible answer: a sort of Manhattan project that would map out a “risk topography” of the financial system. The authors are Markus K. Brunnermeier of Princeton, Gary Gorton of Yale, and Arvind Krishnamurthy of Northwestern. All three are also affiliated with the National Bureau of Economics Research. (I will refer to the team in what follows as BG&K.)

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  • What Can We Learn About the Ryan Medicare Plan from the German Experience?

    Last week Republicans in the US House of Representatives, following the lead of Representative Paul Ryan, endorsed a far-reaching plan to reform Medicare, the nation’s health care system for the elderly. Since it began in 1965, Medicare has been a government-run, single-payer system that reimburses private doctors and hospitals for the health care services they provide. Under the Ryan plan, it would be transformed into a system in which seniors would choose from a list of  competing private insurance plans, with the premiums paid partly by government and partly by the beneficiaries themselves.

    Supporters of the Ryan plan see several benefits. An open letter, posted on the web site of the American Enterprise Institute and signed by a list of prominent physicians and economists, puts it this way:

    Having more control over their health care spending would encourage consumers and patients to make better health care choices. It would stimulate more innovative and accountable competition by health care providers and give them incentives to better coordinate the care of their patients. Enhanced competition could offer seniors relief from rising Medicare premiums. Just as important, this reform could begin to ease the crushing tax burden imposed by the current program on our children and grandchildren.

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