EconoMonitor

Ed Dolan's Econ Blog

Roubini Topic Archive: Trade and External Balance

  • Will the Dutch Disease Kill Hopes Raised by Colombia’s Free Trade Agreement?

    After a torturous journey through Congress, the United States-Colombia Trade Promotion Agreement (CTPA), first signed in 2006, came into effect on May 15 of this year. The agreement has raised high hopes in Colombia, for which the United States is by far the largest trading partner. However, while the CTPA was fighting its way through […]

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  • Latest Data Show U.S. Corporate Profits Falling Due to Global Woes While GDP Growth Remains Sluggish

    The final estimate from the Bureau of Economic Analysis shows U.S. real GDP growing at a sluggish 1.9 percent annual rate in Q1 2012, the same as in the second estimate released at the end of May. Nominal GDP grew at a 3.9 percent annual rate. That is slightly faster than previously estimated but still […]

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  • Latest Data Show US Export Drive is Faltering

    The latest international trade data for the United States show that the country’s export drive, which has been a bright spot in an otherwise weak recovery, is now faltering. Nominal exports of goods grew a modest 1.6 percent in Q1 2012; a broader measure of exports that includes goods, services, and income receipts grew just […]

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  • Globalization and Inequality: Is there a Superstar Effect, and if so, What does it Mean?

    If two things happen at the same time, it is natural to think that one may cause the other. A case in point is the much-discussed linkage between the growth of global trade and the increased inequality of income distribution. The following charts show one way of representing these two trends for the United States. […]

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  • How the Latin Triangle Swallowed the Euro

    Back in 1996, Rudiger Dornbusch wrote a paper about the political economy of exchange rates in Latin America. He called it “The Latin Triangle”. It describes a cycle in which governments become trapped in inappropriate fixed-exchange rates that inevitably end unhappily. Latin America has put that particular form of economic instability behind it, but a […]

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  • The Ecosocialist Critique of Capitalism vs. Real World Socialism

    It has been twenty years now since first glasnost and then the collapse of the USSR lifted the curtain on the appalling environmental record of Soviet socialism. Over that same 20 years, the burgeoning economy of socialist China has overtaken the United States as the world’s largest emitter of greenhouse gasses. Still, it remains common to hear capitalism singled out as the greatest environmental threat to our planet, and socialism as its salvation.

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  • Econ 101, Hayek, and Why We Are Losing the War Against Drugs

    Last week The New York Times reported that the drug cartels, after shaking the political and economic structures of Colombia and Mexico to their foundations, are moving into Central America. Just one more sign, as if we needed it, that the United States is losing its endless war on drugs.

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  • The Impossible Trinity: Why Latin America Hates QE2

    Latin America is up in arms over QE2. Brazil’s finance minister, Guido Mantega, sees the Fed’s program of quantitative easing as a form of currency manipulation on par with China’s efforts to maintain an undervalued yuan. We hear dark talk of currency wars and threats to raise the issue with the G20, the WTO, and anyone else who will listen. Why all the anger directed against what most people in the United States view as a purely domestic policy that hopes to reboot a sluggish recovery? Why wouldn’t that be welcomed by US trading partners in Latin America and everywhere?

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  • If a Stronger Yuan Is Good, Can a Weaker Dollar Be Bad?

    One of the top themes for 2010 in economics, politics, and diplomacy was the damage being done to the U.S. economy by an undervalued Chinese yuan. As the yuan began to appreciate in the second half of the year, slowly in nominal terms but more rapidly in real terms, everyone cheered. At the same time the yuan appreciated, the dollar depreciated, not just relative to the yuan, but to all foreign currencies on average. The broad weakness of the dollar was welcomed much less enthusiastically. Words like “unpleasant” and “grim” tended to be used instead.

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  • U.S. Ethanol Subsidies: A Bad Policy that Refuses to Die

    U.S corn farmers and ethanol distillers are among those celebrating passage of last week’s tax bill. A little-noticed provision of the law extends ethanol tax credits ($.45 per gallon, plus a bonus for small producers) and tariffs on ethanol imports ($.54 per gallon), previously set to expire at the end of 2010. Should the rest of us also celebrate? I think not.

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