Content Type: Policy Brief / Publication Year: within 5 Years and within 25 Years / Topic: Economics

101. Belarus Goes Nuclear: Context and Prospects of the Astravyets NPP

Author:: Yuri Tsarik
Publication Date:: 03-2021
Content Type:: Policy Brief
Institution:: International Centre for Defence and Security - ICDS
Abstract:: On 7 November 2020, the president of Belarus, Aleksander Lukashenko, visited the Astravyets Nuclear Power Plant (Astravyets NPP) and dubbed its pending commissioning a “historic moment” for Belarus. Despite several incidents during the tests in late 2020 and early 2021 that prompted shutdowns of the reactor, the first unit was reconnected to Belarus’s power grid at full nominal capacity on 21 January 2021. The Astravyets NPP launch took place amid the worst political crisis in the country’s history. Following a rigged presidential election in August 2020 and violent suppression of the ensuing protests, the Belarusian authorities found themselves lacking legitimacy domestically and facing mounting political and economic pressure internationally. These events, and the choices made in response to them, are reshaping the geopolitical and geoeconomic context in which the plant will operate and thus are affecting the prospects of the entire project.
Topic:: Economics, Nuclear Power, Elections, Geopolitics, Legitimacy, and Political Crisis
Political Geography:: Eurasia and Belarus

102. Assessing the economic, societal, and cultural benefits of YouTube in Poland

Author:: Oxford Economics
Publication Date:: 11-2021
Content Type:: Policy Brief
Institution:: Oxford Economics
Abstract:: This study assesses YouTube’s contribution to GDP and employment in Poland, and its broader impact on society and culture. YouTube enables Polish content creators to reach a large domestic and international audience. This supports substantial economic value for those who earn income from the platform, for example as they are paid a share of the revenues from advertising placed alongside their videos. A YouTube presence can also help creators earn revenues from other sources, such as product sales, brand partnerships, or live performance engagements. These revenue sources not only support jobs and income for the creators themselves, but also wider activity in supply chains, and through workers’ spending. In total, our economic modelling suggests that YouTube’s creative ecosystem contributed around €98 million to the Polish economy in 2020 and supported 11,000 full-time equivalent jobs. In this report we outline our economic analysis, as well as the findings of wider survey research to investigate how YouTube can build skills and knowledge amongst users; enrich and promote Polish culture; and sustain careers for content creators. We also highlight how YouTube has proved helpful during Covid-19. Alongside the findings from our economic modelling and surveys, we present a series of case studies to highlight th the personal stories of successful Polish content creators.
Topic:: Economics, Mass Media, Social Media, YouTube, and Content Analysis
Political Geography:: Europe and Poland

103. Assessing the economic, societal, and cultural benefits of YouTube in Spain

Author:: Oxford Economics
Publication Date:: 11-2021
Content Type:: Policy Brief
Institution:: Oxford Economics
Abstract:: YouTube enables Spanish content creators to reach a large domestic and international audience. This supports substantial economic value for those who earn income from the platform, for example as they are paid a share of the revenues from advertising placed alongside their videos. A YouTube presence can also help creators earn revenues from other sources, such as product sales, brand partnerships, or live performance engagements. These revenue sources not only support jobs and income for the creators themselves, but also wider activity in supply chains, and through workers’ spending. In total, our economic modelling suggests that YouTube’s creative ecosystem contributed around €313 million to the Spanish economy in 2020 and supported 21,000 full-time equivalent jobs. In this report we outline our economic analysis, as well as the findings of wider survey research to investigate how YouTube can sustain careers for content creators; build skills and knowledge amongst users; and promote Spanish culture to a global audience. We also highlight how YouTube has proved helpful during Covid-19. Alongside the findings from our economic modelling and surveys, we present a series of case studies to highlight the personal stories of successful Spanish content creators.
Topic:: Economics, Mass Media, Social Media, YouTube, and Content Analysis
Political Geography:: Europe and Spain

104. AirBnB: An Economic Engine in the EU27

Author:: Oxford Economics
Publication Date:: 11-2021
Content Type:: Policy Brief
Institution:: Oxford Economics
Abstract:: This study seeks to identify Airbnb’s contribution to: • Economic Impact – Airbnb guests spend in the local area, stimulating the local economy and providing employment opportunities. • Geographical Dispersion – Airbnb’s model results in visitors staying in a wider range of areas within countries outside of the more typical destinations visited. This has helped drive an observed urbanto-rural shift in tourism. • Pandemic Resilience – Throughout the pandemic, Airbnb supported travel to both rural and urban locations within the EU27. Despite the significant fall in travel over the pandemic period, Airbnb’s travel fell less than the industry average, indicating pandemic resilience on the part of Airbnb.
Topic:: Economics, Tourism, Local, and Travel
Political Geography:: Global Focus

105. Assessing the economic, societal, and cultural benefits of YouTube in Italy

Author:: Oxford Economics
Publication Date:: 11-2021
Content Type:: Policy Brief
Institution:: Oxford Economics
Abstract:: YouTube enables Italian content creators to reach a large domestic and international audience. This supports substantial economic value for those who earn income from the platform, for example as they are paid a share of the revenues from advertising placed alongside their videos. A YouTube presence can also help creators earn revenues from other sources, such as product sales, brand partnerships, or live performance engagements. These revenue sources not only support jobs and income for the creators themselves, but also wider activity in supply chains, and through workers’ spending. In total, our economic modelling suggests that YouTube’s creative ecosystem contributed around €190 million to the Italian economy in 2020 and supported 15,000 full-time equivalent jobs. In this report we outline our economic analysis, as well as the findings of wider survey research to investigate how YouTube can sustain careers for content creators; promote Italian culture to a global audience; drive cultural diversity; and support businesses. We also highlight how YouTube has proved helpful during Covid-19. Alongside the findings from our economic modelling and surveys, we present a series of case studies to highlight the personal stories of successful Italian content creators.
Topic:: Economics, Mass Media, Social Media, YouTube, and Content Analysis
Political Geography:: Europe and Italy

106. Assessing the economic, societal, and cultural benefits of YouTube in Ireland

Author:: Oxford Economics
Publication Date:: 12-2021
Content Type:: Policy Brief
Institution:: Oxford Economics
Abstract:: YouTube enables Irish content creators to reach a large domestic and international audience. This supports substantial economic value for those who earn income from the platform, for example as they are paid a share of the revenues from advertising placed alongside their videos. A YouTube presence can also help creators earn revenues from other sources, such as product sales, brand partnerships, or live performance engagements. These revenue sources not only support jobs and income for the creators themselves, but also wider activity in supply chains, and through workers’ spending. In total, our economic modelling suggests that YouTube’s creative ecosystem contributed around €30 million to the Irish economy in 2020 and supported 1,600 full-time equivalent jobs. In this report we outline our economic analysis, as well as the findings of wider survey research to investigate how YouTube can build skills and knowledge amongst users; promote cultural diversity; and sustain careers for content creators. We also highlight how YouTube has proved helpful during Covid-19.
Topic:: Economics, Mass Media, Social Media, YouTube, and Content Analysis
Political Geography:: Europe and Ireland

107. The European Union at a Crossroads: Unlocking Renewable Hydrogen’s Potential

Author:: Nicola De Blasio and Alejandro Nuñez-Jimenez
Publication Date:: 11-2021
Content Type:: Policy Brief
Institution:: Belfer Center for Science and International Affairs, Harvard University
Abstract:: European countries are at a crossroads on their path to carbon neutrality. Today, they are at the forefront of the global clean hydrogen race but going forward they would be better served by collaborating instead of working alone. Overall, the European Union (EU) is highly competitive in clean technologies manufacturing and thus well-positioned to benefit from the emergence of global hydrogen markets. But a narrow focus on short-term cost considerations could drive member states to implement national roadmaps with little or no coordination among themselves and hence little or no chance of competing globally. As a bloc, the EU has pledged to reach carbon neutrality by 2050. Clean hydrogen is a cornerstone of this transformational effort; accordingly, in July 2020, the EU adopted its hydrogen strategy with the ambition of deploying open and competitive clean hydrogen markets for all energy sectors and segments by 2050.1 Success hinges around implementing a cohesive long-term strategy to address a fundamental ques- tion and its associated challenges: where could the EU source competitive and secure renewable hydrogen supplies? As our previous research shows, all countries have access to renewable resources (such as solar or wind), to different degrees, and could produce some renewable hydrogen locally. However, while resource-rich countries, such as Spain, could evolve into regional exporters, no EU member state has the potential to become a global export champion. At the same time, North African countries, such as Morocco, are well-situated to act as key suppliers to the EU. Furthermore, imports from resource-rich regions like North America could help to address security of supply concerns.2 Today, EU hydrogen demand stands at 7.8 million tons per year (Mt/yr), equivalent to about 10% of global demand. Germany and the Netherlands are the largest consumers, accounting for over a third of EU demand, followed by Poland, Spain, Italy, Belgium, and France, which consume about 0.5 Mt/yr each.3 According to available projections, as hydrogen use grows across all economic sectors, EU hydrogen demand could reach 76 Mt/yr by 2050. But while the EU strategy sets clear targets on electrolyzer deployment by 2030, it provides very few details on how the bloc could meet demand—and at what cost—by 2050.
Topic:: Economics, Environment, Science and Technology, Natural Resources, European Union, Innovation, Hydrogen, and Energy
Political Geography:: Europe

108. The evolving gender gap in labor force participation during COVID-19

Author:: Simeon Djankov, Pinelopi Koujianou Goldberg, Lisa Hyland, and Eva (Yiwen) Zhang
Publication Date:: 04-2021
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: Despite many significant gains by women in the paid workforce in recent decades, the percentage of women participating in the labor force has remained lower than the percentage of male participants. Now, in response to the COVID-19 pandemic and the global economic downturn it precipitated, the gap in labor force participation between men and women in some economies has actually widened, with potentially damaging repercussions for women’s career prospects and pay. The pandemic has disproportionately affected sectors employing more women, such as retail stores, restaurants, and the hotel and hospitality business. An increase in family caregiving responsibilities because of school and childcare closures has also fallen on working mothers' shoulders. Both factors have pulled women out of the labor force. The authors track trends in male and female labor force participation in 43 countries and find substantial differences across countries in the way women’s participation has been affected relative to that of men. In some countries, such as Colombia, Chile, and Cyprus, the gender gap in labor force participation widened the most during the pandemic. The gender gap also widened in the United States, driving 2.5 million women from their jobs in what Vice President Kamala Harris called a “national emergency” for women. In other economies, such as Luxembourg and Lithuania, the gender gap in labor force participation, unexpectedly, shrank during the early period of the pandemic. On average, female employees have fared better in countries where women are less concentrated in the services sector, less likely to be employed as temporary workers, and where laws supported greater equality at the onset of the crisis. Greater government expenditure on childcare in the pre-COVID-19 era, however, does not appear to have insulated female workers from the damaging repercussions of the pandemic.
Topic:: Economics, Gender Issues, Labor Issues, Women, Services, COVID-19, and Empowerment
Political Geography:: Colombia, Chile, Cyprus, Global Focus, and United States of America

109. Economic costs and benefits of accelerated COVID-19 vaccinations

Author:: Joseph E. Gagnon, Steve Kamin, and John Kearns
Publication Date:: 05-2021
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: COVID-19 vaccination programs are generally understood to be a prerequisite for a return to normalcy in our social and economic lives. Emergency measures to research, test, produce, and distribute vaccines have been expensive, but increases in GDP resulting from the vaccines are expected to exceed those costs by wide margins. Few studies have quantified the economic costs and benefits of different rates of COVID-19 vaccination, however. This Policy Brief focuses on developing such a quantitative assessment for the United States; the approach may be applied to other countries as well. Two illustrative scenarios support the conclusion that most plausible options to accelerate vaccinations would have economic benefits that far exceed their costs, in addition to their more important accomplishment of saving lives. This Policy Brief shows that if, for example, the United States had adopted a more aggressive policy in 2020 of unconditional contracts with vaccine producers, the up-front cost would have been higher but thousands of lives would have been saved and economic growth would have been stronger. Instead, the federal government conditioned its contracts on the vaccines’ being proven safe and effective. The projections presented in this analysis show that even if unconditional contracts led to support for vaccines that failed the phase III trial and ultimately were not used, the cost would have been worth it.
Topic:: Economics, Health, Crisis Management, COVID-19, and Health Crisis
Political Geography:: North America and United States of America

110. The economic gains of reducing the employment gender gap in Morocco

Author:: Olivier Bargain and Maria C. Lo Bue
Publication Date:: 06-2021
Content Type:: Policy Brief
Institution:: United Nations University
Abstract:: Middle East and North Africa (MENA) countries, including Morocco, currently record the lowest rates of female labour force participation (FLFP) in the world. These rates — between 20-30% in 2019 — appear substantially low in comparison to Western countries, but also compared to low- and middle-income countries that average between 40% (Asia) and 55% (Latin America and sub-Saharan Africa).
Topic:: Economics, Gender Issues, Women, Employment, and Economic Growth
Political Geography:: North Africa and Morocco

111. The nonsense of Next Generation EU net balance calculations

Author:: Zsolt Darvas
Publication Date:: 01-2021
Content Type:: Policy Brief
Institution:: Bruegel
Abstract:: The estimation of payments from the European Union’s COVID-19 economic recovery fund, Next Generation EU (NGEU), to each EU country in 2021-2026 involves uncertainties, yet the overall magnitudes can be estimated with a reasonable degree of precision. In contrast, estimating member states’ contributions to the repayment of EU debt (which will be issued to finance NGEU spending) is burdened with enormous difficulties, primarily related to the uncertainty of gross national income projections up to 2058. Some numerical scenarios can be put forward to illustrate the difficulties in estimating the amounts of such future contributions.
Topic:: Economics, Governance, European Union, Macroeconomics, and COVID-19
Political Geography:: Europe

112. Supporting a Public Purpose in Research & Development: The Role of Tax Credits

Author:: Jake Taylor
Publication Date:: 06-2021
Content Type:: Policy Brief
Institution:: Belfer Center for Science and International Affairs, Harvard University
Abstract:: Tax credits for research and development are a means of incentivizing the private sector to invest their own resources on challenging problems. However, in practice, the fungibility of tax credits and other monetary elements can lead to misalignment between the public good represented by R&D and the actions of the company. In this policy brief, we consider the existing mechanism of tax credits. We see how they can encourage private sector risk-taking to enable research and development (R&D) outcomes. However, our goal is to go beyond economic growth benefits, and to include the less tangible considerations of public good and public purpose in the research and development domain. We then suggest an expansion of tax credits focused on supporting the researchers involved in the R&D and encouraging innovation in both large organizations and in startups and small businesses. This approach builds upon the existing framework of agency-led, mission-defined support of the private sector used by the U.S. government, as occurs in other programs such as America’s Seed Fund (sometimes known by its acronyms, SBIR and STTR). The integration of specific agency- and mission-focused elements to the credit system ensures that these additive credits support research and researchers whose R&D outcomes will improve the health, prosperity, and opportunity for the U.S. as a whole. Specific means of implementing this public-purpose R&D credit system under existing authorities within the executive branch are suggested, along with the public-facing mechanisms for creating and maintaining the evaluation approach of what constitutes “public purpose” as science and society progress.
Topic:: Economics, Science and Technology, International Affairs, Tax Systems, and Tax Credits
Political Geography:: Global Focus and United States of America

113. The Ahvas Protests Are the minorities' demonstrations a reflection of a crisis in Tehran?

Author:: FARAS
Publication Date:: 08-2021
Content Type:: Policy Brief
Institution:: Future for Advanced Research and Studies (FARAS)
Abstract:: On July 15, Khuzestan in South West Iran witnessed a range of protests against the disintegrating economic and living conditions in the country, particularly the lack of water within the province, which was called ‘water protests’ or ‘thirst protests’, This was extended to other Iranian cities outside Khuzestan. The protesters' demands evolved to demand the overthrow of the regime itself raising slogans of ‘Death to Khamenei’.
Topic:: Economics, Water, Minorities, and Protests
Political Geography:: Iran and Middle East

114. Ousting Ennahda: Will Kais Saied's decisions help solve the crisis in Tunisia?

Author:: FARAS
Publication Date:: 07-2021
Content Type:: Policy Brief
Institution:: Future for Advanced Research and Studies (FARAS)
Abstract:: On the Tunisia’s 64th Republic Day -Sunday, July 25, 2021- the so-called 25 July Movement called for massive protests all over the country. Consequently, many responded and started protesting in Bardo Square, near the parliament, in the capital Tunis. The protests soon spread across other governorates, such as Sousse, the coastal governorate, Sfax (in the south), and El-Kef (in the northwest). In response, President Kais Saied announced, on July 26, 2021, the dismissal of Prime Minister Hichem Mechichi and his cabinet, which consisted of 25 ministries. Saied decided to take charge of executive power until he chooses another politician to form a new government. He further suspended the current parliament and lifted the parliamentary immunity of all its members. Besides, he decided to rule by issuing decrees instead of the laws, which the parliament was supposed to pass. These decisions were announced after the emergency meeting that was chaired by president Saied, and attended by military leaders and security officials on the day the protests and rallies broke out. The protesters demanded reforming the economy, combatting corruption and terrorism, dismissing the Mechichi cabinet, and dissolving the parliament.
Topic:: Economics, Government, Reform, Crisis Management, and Ennahda Party
Political Geography:: North Africa and Tunisia

115. Trade and trust: the role of trade in de facto state conflict transformation

Author:: Tamta Gelashvili, Helge Blakkisrud, and Nino Kemoklidze
Publication Date:: 02-2021
Content Type:: Policy Brief
Institution:: Norwegian Institute of International Affairs
Abstract:: De facto states – unrecognized secessionist entities that eke out a living on the margins of the international system – are often heavily dependent on external patron states for economic aid and investment. When the parent state – the state that the de facto state seeks to break away from – responds to the secessionist attempt by imposing sanctions or economic blockades, this further exacerbates such dependency. Moreover, due to their lack of international recognition, de facto states often have limited opportunities to engage with the outside world beyond the patron and the parent state. However, closer examination of one such de facto state, Abkhazia, reveals that de facto states can enjoy some bounded independent economic agency. Abkhazia’s maneuvering between Russia as “patron,” Georgia as “parent state,” and the wider international community (here exemplified by the EU) in the sphere of trade and economic interaction has important implications for de-facto state conflict transformation.
Topic:: Conflict Resolution, Economics, Emerging States, and Trade
Political Geography:: Russia and Eurasia

116. ‘A careful foot can step anywhere’: The UAE and China in the Horn of Africa: Implications for EU engagement

Author:: Jos Meester and Guido Lanfranchi
Publication Date:: 06-2021
Content Type:: Policy Brief
Institution:: Clingendael Netherlands Institute of International Relations
Abstract:: Over the last decade, the UAE and China have vastly expanded their economic, political and military footprint in the Horn of Africa, and their actions now have the potential to shape developments in the region. Room for cooperation between Abu Dhabi and Beijing exists on issues such as maritime security, regional stability, and economic development. Moreover, the two countries’ interaction could lead to improvements in the Horn’s underdeveloped infrastructure by triggering a race to investment. Yet, development and stability in the region might suffer if the strategic interests of external players take precedence over local ones, or if local elites (mis)use external support for narrow domestic political calculations. The EU and its member states have high stakes in the Horn’s stability. To optimise their engagement, European policymakers should be aware of the implications of the Emirati and Chinese presence, and they should strive to improve cooperation among the wide range of external players active in the Horn.
Topic:: Economics, International Cooperation, Politics, Military Affairs, Economic Development, and Economic Stability
Political Geography:: Africa, China, Asia, and Horn of Africa

117. Biden-Erdogan meeting: cautious rapprochement amid still thorny disputes

Author:: Al Jazeera Center for Studies
Publication Date:: 06-2021
Content Type:: Policy Brief
Institution:: Al Jazeera Center for Studies
Abstract:: As long as Turkey pursues its regional ambitions, any understandings with the US and the West will necessarily have a hard ceiling. However, Ankara seems to be pursuing a more conciliatory policy in the region and in its relations with the West for both economic and strategic reasons.
Topic:: International Relations, Economics, Bilateral Relations, Recep Tayyip Erdoğan, Rapprochement, Strategic Interests, and Joe Biden
Political Geography:: Turkey, Middle East, North America, and United States of America

118. Building Infrastructure in Real Time: Avoiding Regulatory Paralysis

Author:: Committee for Economic Development of the Conference Board
Publication Date:: 09-2021
Content Type:: Policy Brief
Institution:: The Conference Board
Abstract:: The physical infrastructure base of the US economy, once an advantage in global competition, has become a liability. This problem has multiple causes, several of which CED has addressed in recent policy statements, and our nation’s elected policymakers are now taking up the need for additional funding. But the nation needs not only adequate funding but also a more-efficient regulatory process for our infrastructure investment—choosing the right projects, with the minimum delay, and executing them at the least possible cost. Regulatory paralysis is one of the causes of our infrastructure shortfall. It needs attention if we are going to spend our tax dollars on infrastructure wisely and efficiently so that the US economy remains globally competitive. Streamlining regulatory procedures, promoting competition, and cutting red tape across federal, state, and local governments are key to increasing investment, decreasing cost, and maximizing efficiency. Business as usual will not suffice. It takes too long and costs too much to deliver infrastructure projects, preventing us from achieving the advancements and improvements that a future-focused, competitive economy requires. CED has consistently advocated “smart regulation,” subjecting new regulations to rigorous cost-benefit analysis and reviewing existing regulations for continuing cost effectiveness to enhance efficiency and achieve quicker execution, greater benefits, and lower costs. With long delays between project conception and execution, and often multiple layers of jurisdiction and review, a smart regulation approach could ensure that the rules governing review and permitting of projects address all important concerns and ensure that net benefits are maximized over time at all levels of government on a comprehensive and timely basis.
Topic:: Economics, Infrastructure, Governance, Regulation, Business, Economic Policy, and Strategic Competition
Political Geography:: North America and United States of America

119. Annual Social Security and Medicare Trustees Report Reflects Worsening Economic Environment

Author:: Committee for Economic Development of the Conference Board
Publication Date:: 09-2021
Content Type:: Policy Brief
Institution:: The Conference Board
Abstract:: The Trustees of the Social Security and Medicare Trust Funds are required by law to produce an annual report on April 1 of each year. It is by no means a shock that the report is late in any year; it happens often. This year, however, there is probably more of a justification that the report was released only yesterday, five months late. The economic and health care environments are perhaps as chaotic and uncertain as they have been in living memory.
Topic:: Economics, Health Care Policy, and Social Security
Political Geography:: North America and United States of America

120. Energy price hikes: which European solutions?

Author:: Ramona Bloj
Publication Date:: 10-2021
Content Type:: Policy Brief
Institution:: Robert Schuman Foundation (RSF)
Abstract:: As energy prices rise around the world, against the backdrop of the post-Covid economic recovery, the 27 EU leaders discussed what Europe could do to ease the pressure on consumers at the European Council on 21-22 October. The increase in prices is due to a particular international context and is affecting all countries: China is facing electricity shortages in many provinces due to insufficient coal supply, and in the United States the price of natural gas has risen by more than 150% since the beginning of the year. However, this increase raises questions about Europe's energy strategy and its impact on climate objectives, just a few days before the opening of COP26 in Glasgow.
Topic:: Climate Change, Economics, Energy Policy, and COVID-19
Political Geography:: Europe

121. The myths and realities of China's economic coercion

Author:: Luke Patey
Publication Date:: 11-2021
Content Type:: Policy Brief
Institution:: Danish Institute for International Studies (DIIS)
Abstract:: Despite the significance of the world’s second largest economy increasingly using its trade and connectivity as a weapon to advance its foreignand security-policy aims, separating the myths from the realities of Chinese coercion is crucial in shaping appropriate policy responses and deterring China and others from such assertive behaviour.
Topic:: Security, Foreign Policy, Defense Policy, Diplomacy, Economics, and Coercion
Political Geography:: China, Europe, Asia, and Denmark

122. Europe under US Monetary Hegemony: How the COVID-19 Pandemic Will Undermine a 100-Year-Old Relationship

Author:: Brendan Brown
Publication Date:: 10-2020
Content Type:: Policy Brief
Institution:: Hudson Institute
Abstract:: This policy study is based on the newly released book, Europe’s Century of Crises under Dollar Hegemony: A Dialogue on the Global Tyranny of Unsound Money, by Brendan Brown and Philippe Simonnot, published by Palgrave Macmillan. One hundred years ago, the United States emerged from the First World War and its immediate aftermath, including the Spanish flu pandemic, as the global monetary hegemon, exercising immense power over the Old Continent. This new power quickly became the source of huge instability in Europe, culminating in the collapse of the Weimar Republic. After World War II, the Bretton Woods system set new contours for US monetary hegemony, ultimately resulting in the great economic crisis of 1973–75. This woeful history continues to the present day: Dollar hegemony has not been a force for good. It could have been different. The United States and Europe would both have gained from a US hegemony based on sound money principle. Instead, the guiding characteristic of US monetary power has been inflation, especially around election time. According to the doctrine made notorious by Treasury Secretary John Connally, who served under President Nixon, “the dollar is our currency but your problem.” The US monetary regime’s further lurch toward fundamental unsoundness during the COVID-19 pandemic is not getting the new century of US monetary hegemony off to a new start. The “known unknown” is whether forces will emerge in Europe that will again challenge US inflationary dominance, as occurred under Germany’s leadership in the 1970s. Could high inflation in the post-pandemic US economy cause US monetary hegemony over Europe to crumble?
Topic:: Economics, International Trade and Finance, History, Monetary Policy, Hegemony, Transatlantic Relations, and COVID-19
Political Geography:: Europe and United States of America

123. An Analysis Of The Legislation About Business Creation In Cameroon

Author:: Ulrich D’POLA KAMDEM and Dr. Louis-Marie Kakdeu
Publication Date:: 08-2020
Content Type:: Policy Brief
Institution:: The Nkafu Policy Institute
Abstract:: Small and Medium-sized Enterprises (SMEs) represent the main driver of economic growth both in developing and emerging economies. Statistics from the World Bank show that in emerging economies, 40% of the national income (Gross Domestic Product – GDP) and 60% of total employment are attributed to formal SMEs. In developing economies, Cameroon included, SMEs have the potential to contribute more to the GDP and the level of employment. But they face several obstacles that prevent them from flourishing. Among these obstacles, legislation is among the main barriers to business creation. This article, therefore, analyses the contribution of legal aspects to business creation in Cameroon. Our analysis focuses on the following aspects: the legal framework, the documents required to open a business, and the regulatory and fiscal repression.
Topic:: Economics, Labor Issues, Employment, and Business
Political Geography:: Cameroon

124. Harnessing Public Accountability in the Public Service for Better Governance in Cameroon

Author:: Tazoacha Francis
Publication Date:: 11-2020
Content Type:: Policy Brief
Institution:: The Nkafu Policy Institute
Abstract:: The failure of governance in Cameroon is a result of the acute lack of public accountability. Public administration is a major preoccupation in all contemporary democracies in the world today, even though there are disparities in the benchmarks, means, and agents of such culpability based on the nature of the polity ranging from traditional to modern, conservative to liberal, capitalist to socialist [1]. Public accountability is the major concern of contemporary democratic governance in every society today. Democratic consensus will remain abstract if those in leadership cannot be held responsible by the community for their deeds and oversights, for their judgments, their policies, and their expectancies. Therefore, there is a dire need in every public office be it government or private to make sure that this exercise is carried out in order to make checks and balances in these services for effective management of resources, proper accountability, and sustainable development.
Topic:: Economics, Governance, Accountability, and Public Sector
Political Geography:: Cameroon

125. What Tax Policy In Cameroon After 2020?

Author:: William Hermann ARREY
Publication Date:: 12-2020
Content Type:: Policy Brief
Institution:: The Nkafu Policy Institute
Abstract:: The COVID-19 pandemic has imposed unprecedented negative consequences on the Cameroonian economy. To reduce the spread of the virus, the government imposed a range of measures such as social distancing and border closures to protect its citizens. While the social costs leave little to be desired, the pandemic equally took a toll on a majority of sectors across the economy, impacting wages, consumer spending, and profitability for businesses. This fiscal policy letter analyzes the amended budget, delving into aspects related to the Covid-19 pandemic, as well as the structural factors that could determine the viability and sustainability of public finances in the coming decades. The first article looks at the implications of the pandemic for domestic revenue tax mobilization with the aim of improving the personal income and non-oil tax in the business sector. It recommends that the government consolidates public sector spending, reduces taxes on businesses in the non-oil sector, and suspend tax payments on businesses as the pandemic abates.
Topic:: Economics, Tax Systems, Fiscal Policy, Consumerism, and Wage Growth
Political Geography:: Cameroon

126. Flattening the Pandemic and Recession Curves

Author:: Pierre-Olivier Gourinchas
Publication Date:: 03-2020
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: In the short run, the capacity of any country’s health system is finite (capacity of Intensive Care Units, number of hospital beds, number of skilled health professionals, ventilators….). This puts an upper bound on the number of patients that can be properly treated, at any given point in time and is represented by the flat line in the Figure. Unchecked, and given what we know of the transmission rate of the coronavirus, the pandemic would quickly overwhelm any health system, leaving many infected patients with deteriorating pulmonary conditions without any treatment. The fatality rate would surge. The threat is almost beyond comprehension. With a 2% case fatality rate baseline for overwhelmed health systems, and 50% of the world population infected, 1% of the world population -76 million people- would die. This scenario corresponds to the red curve in Figure 1. The part of the curve above the capacity of the health care system faces a sharply higher mortality risk (shaded red area).
Topic:: Economics, International Political Economy, Health Care Policy, Economic Growth, Macroeconomics, Pandemic, COVID-19, and Global Health
Political Geography:: United States

127. Coronavirus and Managing Your Organization’s Response

Author:: Anton Korinek
Publication Date:: 03-2020
Content Type:: Policy Brief
Institution:: The Nkafu Policy Institute
Abstract:: Organizations around the world are working through how to respond to the novel coronavirus, posing one of the greatest challenges to leaders in a long time. Do they restrict travel? Doing so would have substantial financial implication, make months of preparation worthless and lower the morale of many stakeholders who enjoy travel. However, travel is what brought the coronavirus to the country in the first place — and what continues to spread it to new communities within the country. What about instituting remote work procedures? In-person meetings and events may be a critical part of an organization’s activities and an important part of the value it offers. Perhaps there are no known cases of the virus in a given community. However, once it does gain a foothold, social distancing is the only way to slow the spread. Carriers of the virus may unwittingly spread it for days before symptoms manifest themselves. Above all, one of the greatest challenges is to balance an organization’s economic concerns with the question of what is ethically the best course of action.
Topic:: Economics, International Political Economy, Pandemic, and COVID-19
Political Geography:: United States and Global Focus

128. Born Out of Necessity: A Debt Standstill for COVID-19

Author:: Patrick Bolton, Lee Buchheit, Pierre-Olivier Gourinchas, Mitu Gulati, Chang-Tai Hsieh, Ugo Panizza, and Beatrice Weder di Mauro
Publication Date:: 04-2020
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: Rich and poor countries alike are facing an unprecedented economic crisis as they attempt to contain the impact of the COVID-19 pandemic. A downturn of this magnitude can cause tremendous long-term damage, with critical economic linkages between employees, businesses, and banks at risk of disappearing forever. Scores of firms will close permanently unless urgent action is taken. The threat is even more significant for emerging economies, where the economic costs of social distancing are likely to be higher, and where vulnerable small and medium sized enterprises with low cash reserves account for a much larger share of the economy than in rich countries, which can rely on extensive social and economic safety nets. Poor countries, moreover, have far more precarious health-care systems. The funds required to support vulnerable workers and businesses, and to care for COVID-19 patients, could be as high as 10% of their GDP. As a comparison, in the US the rescue measures passed in the last month alone account for at least 10% of GDP, and are likely to increase even more. A number of European countries have commited loans, equity injections and guarantees up to 35% of GDP. The COVID-19 crisis has led to a sudden collapse in capital flows to emerging and developing countries. According to estimates by the Institute of International Finance, non-resident portfolio outflows from emerging market countries amounted to nearly $100 billion over a period of 45 days starting in late February 2020. For comparison, in the three months that followed the explosion of the 2008 global financial crisis, outflows were less than $20 billion.
Topic:: Debt, Economics, International Political Economy, GDP, Business, Macroeconomics, Pandemic, COVID-19, and Credit
Political Geography:: Global Focus

129. In Defense of Alternatives to Pollution Pricing

Author:: Garth Heutel
Publication Date:: 05-2020
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: 2020 marks the 100th anniversary of the publication of economist Arthur Cecil Pigou’s The Economics of Welfare. This book is widely recognized as introducing the concept of Pigouvian welfare economics, that is, of using the basic tools of neoclassical economics to study how to improve the functioning of the economy and people’s lives. While Pigou’s analysis touched on many topics in the economy, the part of Pigouvian welfare economics most remembered today by environmental economists (and perhaps by anyone who has taken an introductory microeconomics course) is his theory of externalities. Pigou argued that externalities, like pollution or congestion, create market failures, but that they can be cost-effectively remedied using taxes or subsidies. These price policies have come to be known as Pigouvian pricing, or Pigouvian taxes or subsidies. If there is one common lesson argued by most environmental economists today regarding the design of environmental policy, it is: the best way to correct the market failure caused by pollution is Pigouvian pricing. According to this argument, a price should be levied on pollution equal to the value of the damages it causes to society. The price can be directly applied via a pollution tax, or indirectly via a cap-and-trade system where the permit price becomes the Pigouvian price on pollution. If the price is correct, then the most efficient outcome will be realized, and it will be achieved at the lowest possible cost to society. A corollary is that environmental policies other than price policies, for example technology mandates or performance standards (what economists often call “command-and-control” policies), are inferior and should not be used.
Topic:: Economics, Environment, Natural Resources, Regulation, Macroeconomics, Microeconomics, Pollution, and Price
Political Geography:: Global Focus

130. Racial Inequality

Author:: Lisa D. Cook and Trevon Logan
Publication Date:: 06-2020
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: The origins of American capitalism in the institutions of slavery continues to cast a long shadow. As the economist William Darity Jr. has written, the dead hand of history weighs heavily on us because the dead hand of history remains fitfully alive. Contemporary racial inequality can be thought of as the product of a long historical process with at least two reinforcing sets of policies. The first would be policies governing the spatial distribution of the black population. The second would be policies that had a disparate impact on black individuals because of their locations. Understanding current black-white gaps in income, wealth and education require understanding the complex relationship between regional inequality, race and policies at the local, state, and national levels. In this article, we outline the ways that the spatial distribution of the black population has evolved over time and the ways that spatial distribution has interacted with policy to, at times, reduce and exacerbate levels of inequality. Recognizing the ways that past policies explicitly stymied black economic mobility and how current policies have explicitly or inadvertently done the same provides a basis for understanding how to craft future policies to reduce racial inequalities. Furthermore, recognizing the interconnection of discrimination and the spatial distribution of the black population is important for understanding certain components of regional and spatial inequality. The difference in location within regions makes it inevitable that policies that differentially affect urban and rural areas will have disparate effects by race. A recent example of this is the proposed Medicaid work requirement in Michigan. The original version of Michigan Senate Bill 897 exempted individuals from this work requirement conditional on residing in a county with an unemployment rate above 8.5 percent. The spatial distribution of the white and black populations of Michigan meant that this exemption would have racially disparate impacts; given that poor white individuals disproportionately live in rural areas and black individuals live in urban areas, the higher unemployment rates in rural counties would disproportionately exempt white Medicaid recipients from the work requirement within the bill. Although—after considerable negative press—the exemption was dropped from the final version of the work requirement bill, this incident reveals the complex interplay between policy, inequality across space, and inequality between races. Even if a policy like the unemployment rate exemption in the Michigan bill is crafted without discriminatory intent, it can nonetheless increase racial inequality. In the following sections we explore the how policy has shaped the geographic and economic mobility of the black population over the past century and a half, drawing from the large literatures on regional inequality and racial discrimination that have all too often been treated in isolation from one another.
Topic:: Economics, Race, Capitalism, Inequality, Slavery, Macroeconomics, Reparations, Racism, and Systemic Racism
Political Geography:: United States

131. Why, When, and How to Teach the Fundamentals of Inequality in Principles

Author:: Can Erbil and Geoffrey Sanzenbacher
Publication Date:: 08-2020
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: The continued rise of economic inequality in the U.S. has been on the radar of economists and policymakers for the last few years. New initiatives and platforms like EfIP (Economics for Inclusive Prosperity) have emerged, where economists work on creating fresh and useful policy ideas to promote more “inclusive” models of generating prosperity. Yet, students still face a lot of confusion, “noise,” and disagreement when it comes to the topic of inequality.[1] Especially in the age of easy access to information online, students not fully literate in economics struggle to sift through the literature and separate rigorous scientifically based research from opinion pieces. This article discusses a way to introduce some recent trends in U.S. inequality to students, and then delve into a specific topic (e.g., racial inequality) in a two-lecture module at the end of an introductory economics course. After all, it is not that the students are not interested in this topic. But, left alone, many of them become confused. Students do not make distinctions between different broad types of inequalities, such as income inequality, wealth inequality, or inequality of opportunity. They do not understand differences in the underlying causes of inequality, which vary depending on whether the topic is inequality across educational groups, gender-based groups, or racial/ethnic groups. And, they make basic mistakes in reading articles or viewing data, such as mixing-up correlation with causation or looking at graphs with different scales. Fortunately, introductory economics courses have a chance to reach students early in their careers, and correct many of these deficiencies. Indeed, recent events in the US compel us to cover inequality and its consequences in our introductory classes. The economic impact of the COVID-19 epidemic falls significantly more on minorities, women, people with lower income levels and people of color.[2] And, the disparities in poverty and opportunity rates between black and non-black populations is at the root of racial discrimination which re-ignited the BLM movement.[3] Indeed, economic inequality is also related to other disciplines in Social Sciences, such as Sociology, Political Science and even Liberal Arts courses such as History and English. However, Economics faculty are well-equipped to cover the empirical outcomes and the underlying economic models – and lay out their strengths as well as short-comings. Given that teaching about economic inequality is an important task, this article will first discuss when it makes sense to teach it. The article will then spend the majority of its time providing some tips for covering the material, as well as some suggested assignments.
Topic:: Economics, Education, Inequality, Economic Inequality, Macroeconomics, and Models
Political Geography:: United States

132. Consumer Expenditure Inequality in Botswana

Author:: Lillian Mookodi
Publication Date:: 10-2020
Content Type:: Policy Brief
Institution:: Botswana Institute for Development Policy Analysis
Abstract:: For over three decades, Botswana has achieved a fast growing economy, with an annual growth in real Gross Domestic Product (GDP) averaging 10.9 percent in the period 1981- 90, faster even than the East Asian Tigers or China (Good and Hughes, 2002). Between 2000 and 2001 financial year, Botswana’s economy recorded higher growth rates of 9.1 percent, an increase from 8.1 percent recorded between 1999 and 2000, which was mainly attributed to the growth in the mining sector (BIDPA Briefing, 2002). To emphasise on the desire to continue growing, Botswana has adopted Vision 2036, and other development strategies and policies to improve the implementation of interventions tackling unsatisfactory social indicators. Botswana has also subscribed to both continental and international frameworks, such as the Africa Agenda 2063 and United Nations (UN) Millennium Declaration and its Eight Millennium Development Goals, and further signed up for the UN Sustainable Development Goals (SDGs) of 2030. Regardless of the afore-mentioned positive growth, and immense efforts, the country has not achieved the desirable results it sought with regard to some of the social indicators, such as employment, unemployment, inequality and poverty.
Topic:: Economics, International Political Economy, Poverty, Labor Issues, Inequality, Demand, Unemployment, and Consumerism
Political Geography:: Africa and Botswana

133. Sovereign Europe, dangerous world: Five agendas to protect Europe’s capacity to act

Author:: Mark Leonard and Jeremy Shapiro
Publication Date:: 12-2020
Content Type:: Policy Brief
Institution:: European Council on Foreign Relations (ECFR)
Abstract:: In the last year, Europe has begun to recognise the need to defend its sovereignty in a threatening world. Covid-19 has revealed and exacerbated many of Europe’s existing vulnerabilities; the European Union and its member states remain unable to act autonomously in key areas of national life. Based on ECFR research, we propose five sovereignty agendas in health, economic, digital, climate change, and traditional security, all designed to promote a more sovereign Europe on that issues that matter most to Europeans. Europe must not relinquish its rules-based approach or lapse into protectionism. But, to protect the open, multilateral order they so cherish, Europeans need to promote new rules permitting them to take action against countries that undermine the international system. The EU’s €750 billion pandemic recovery fund offers the chance to underwrite this ambition – but, ultimately, Europeans need to master the art of acting as a geopolitical force in the world.
Topic:: Security, Climate Change, Economics, Health, Sovereignty, European Union, and Digital Policy
Political Geography:: Europe

134. Russia’s relative resilience: Why Putin feels vindicated by the pandemic

Author:: Kadri Liik
Publication Date:: 12-2020
Content Type:: Policy Brief
Institution:: European Council on Foreign Relations (ECFR)
Abstract:: Covid-19 has damaged Russia’s economy and President Vladimir Putin’s political agenda. Yet the crisis has given the Kremlin some grim self-confidence that things might be bad, but others have it worse. Putin sees most countries’ behaviour in the pandemic as having validated his philosophy of international affairs: liberalism and universal rules are in retreat, while state-centrism is advancing. The pandemic has exposed many of Russia’s weaknesses, ranging from its healthcare system to a general lack of trust in state institutions. But none of these problems implies the imminent collapse of the country’s physical or political infrastructure. The fact that Russia’s economy is projected to contract less than those of most Western countries makes the Kremlin feel vindicated in its economic policies. Russia’s experience of covid-19 has fostered a ‘wait and see’ attitude towards foreign policy in the Kremlin – an expectation that time is on the country’s side.
Topic:: Foreign Policy, Economics, Crisis Management, Resilience, and COVID-19
Political Geography:: Russia and Europe

135. Restraining Ourselves: Helping by Not Hurting

Author:: Nathan Nunn
Publication Date:: 01-2020
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: In this brief, I discuss the current state of economic development policy, which tends to focus on interventions, usually funded with foreign aid, that are aimed at fixing deficiencies in developing countries. The general perception is that there are inherent problems with less-developed countries that can be fixed by with the help of the Western world. I discuss evidence that shows that the effects of such ‘help’ can be mixed. While foreign aid can improve things, it can also make things worse. In addition, at the same time that this ‘help’ is being offered, the developed West regularly undertakes actions that are harmful to developing countries. Examples include tariffs, antidumping duties, restrictions on international labor mobility, the use of international power and coercion, and tied-aid used for export promotion. Overall, it is unclear whether interactions with the West are, on the whole, helpful or detrimental to developing countries. We may have our largest and most positive effects on alleviating global poverty if we focus on restraining ourselves from actively harming less-developed countries rather than focusing our efforts on fixing them.
Topic:: Development, Economics, International Political Economy, Developing World, and Economic Development
Political Geography:: United States and Global Focus

136. Sanctions and the End of Trans-Atlanticism: Iran, Russia, and the Unintended Division of the West

Author:: Rawi Abdelal and Aurélie Bros
Publication Date:: 01-2020
Content Type:: Policy Brief
Institution:: Institut français des relations internationales (IFRI)
Abstract:: Sanctions have become the dominant tool of statecraft of the United States and other Western states, especially the European Union, since the end of the Cold War. But the systematic use of this instrument may produce unintended and somewhat paradoxical geopolitical consequences. The sanctions imposed on the Islamic Republic of Iran and the Russian Federation in the field of energy are particularly illustrative of this phenomenon.
Topic:: Economics, Energy Policy, Sanctions, Geopolitics, Secondary Sanctions, and Transatlantic Relations
Political Geography:: Russia, Iran, Middle East, North America, and United States of America

137. Syria’s Economic Crisis Sparks Rare Protests in Regime Territory

Author:: Oula A. Alrifai
Publication Date:: 01-2020
Content Type:: Policy Brief
Institution:: The Washington Institute for Near East Policy
Abstract:: Besides highlighting Assad’s financial mismanagement, the recent unrest gives the international community a genuine opportunity to push for transition while bolstering the more prosperous local administration in the northeast. Since mid-January, shop owners, government employees, students, and even children have been gathering in the streets of various Syrian communities to express their frustration with the Assad regime’s economic policies and untruths. Although the protests remain small for now, the fact that they have persistently carried on in the middle of regime-controlled territory highlights Bashar al-Assad’s potential vulnerability on these issues. In Suwayda, a Druze-majority province in the south, residents have protested the sharp drop in the value of the Syrian pound/lira and the deteriorating economic situation in general. In the central-western town of Salamiya, protestors were seen chanting “we want to live.” And in the Suwayda town of Shahba, demonstrators raised loaves of bread in the air while openly criticizing Bouthaina Shaaban, Assad’s political and media advisor. The latter protest was partly spurred by a recent interview on the pro-Assad television network al-Mayadeen, where Shaaban not only claimed that the country’s current economy is “fifty times better than what it was in 2011,” but also declared that “Syrians are self-sufficient in everything.” In response, protestors sarcastically noted that her comments referred to her own household’s economy, not Syria’s. Elsewhere, former agriculture minister Nour al-Din Manna described Shaaban’s remarks about the war-torn country as “hard to believe,” and a closer look at the country’s finances supports this disbelief.
Topic:: Foreign Policy, Economics, Syrian War, and Currency
Political Geography:: Middle East, Lebanon, Syria, and United States of America

138. Preferential Trade Agreements vs. Multilateralism: In the New Trump-World, Does Canada Face an Impossible Choice?

Author:: Judit Fabian
Publication Date:: 03-2020
Content Type:: Policy Brief
Institution:: Urban Institute
Abstract:: International trade is often framed in starkly divergent terms: either countries choose multilateral trade agreements (MTAs) and advance the cause of global economic liberalization, or they choose preferred trade agreements (PTAs) and put the entire system at risk. Canada has a long track record of pursuing PTAs and with the Trump administration’s opposition to multilateralism, and longstanding opposition in elements of the Republican and Democratic parties, this trend will likely continue. The question is whether progress will come at the expense of the global trade system. Some economists believe PTAs to be trade-diverting, reducing trade with more efficient producers outside the agreement. Others insist that PTAs can create trade by shifting production to lower-cost producers in one of the participating countries. One prominent contrary argument holds that PTAs lead to discontinuities in tariff regimes between countries and regions, increasing transaction costs, disrupting supply chains, creating opportunities for corruption and harming global welfare, especially in developing nations. While debate continues about the effects of PTAs, a closer examination suggests that worries are overblown about their negative impacts on global trade flows. Evidence indicates that they support rather than harm the international trading system. Countries shut out of PTAs are more motivated to seek out agreements in new markets, increasing liberalization overall. They may also seek a reduction in most-favoured nation (MFN) tariffs, which would deprive PTAs of their major tariff benefits. Studies have found complementarity between preferential and MFN tariffs, revealing that PTAs promote external trade liberalization. Even if a PTA reduces a given country’s incentive to push for multilateral liberalization, it raises the odds of that country liberalizing its trade to avoid getting left behind. PTAs are a response to the difficulties of securing sweeping multilateral agreements. The World Trade Organization (WTO) Agreements authorize them under GATT Article XXIV, GATS Article V, and the enabling clause, and the WTO facilitates a degree of governance over PTAs through its dispute settlement process. Over the past 25 years, countries have adopted these deals at a rapid pace. Between 1994 and 2005, the number of PTAs increased from 50 to 200. By April 2018, 336 were in effect. At the same time, global trade has increased significantly. Between 1994 and 2010, the volume of world merchandise exports more than doubled. The proliferation of PTAs has resulted in a rise in international trade governance, because the countries involved shape their relationships in line with the WTO agreements. This juridification makes PTAs subordinate to the international system rather than giving them room to dissolve it. Canada should therefore have no fear of pursuing PTAs within the larger framework of the effort to achieve multilateral trade liberalization.
Topic:: Economics, International Trade and Finance, Governance, Trade, and Donald Trump
Political Geography:: Canada, North America, and United States of America

139. Securing macroeconomic and monetary stability with a Federal Reserve–backed digital currency

Author:: Julia Coronado and Simon Potter
Publication Date:: 03-2020
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The US monetary system faces significant challenges from advances in technology and changes in the macroeconomy that, left unaddressed, will threaten the stability of the US economy and financial system. At the same time, low interest rates mean that central banks will not have the policy ammunition they had in the past during the next recession. The Federal Reserve needs new tools to meet its mandates of price stability and maximum employment. It also needs to preserve the safety and soundness of the financial system in a rapidly digitizing world. The authors propose a Fed-backed digital currency to solve both problems. Their proposal creates a regulated system of digital currency accounts for consumers managed by digital payment providers and fully backed by reserves at the Fed. The system would be limited in size, to preserve the functions and stability of the existing banking system. Fed backing would mean low capital requirements, which would in turn facilitate competition. Low fees and no minimum balance requirements in the new system would also help financial institutions reach the roughly 25 percent of the US population that is currently either unbanked or underbanked. Digital accounts for consumers could also provide a powerful new stabilization tool for both monetary and fiscal policies. For fiscal policy, it could facilitate new automatic stabilizers while also allowing the Fed to provide quantitative easing directly to consumers. This tool could be used in a timely manner with broad reach to all Americans.
Topic:: Economics, Government, Monetary Policy, Banks, and Macroeconomics
Political Geography:: North America and United States of America

140. Reviving the potency of monetary policy with recession insurance bonds

Author:: Julia Coronado and Simon Potter
Publication Date:: 04-2020
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: In the second part of their Policy Brief, Coronado and Potter discuss how the system of digital payment providers (DPPs) proposed in their first Policy Brief on this topic adds a new weapon to the monetary toolkit that could be implemented in a timely, effective, and inclusive manner. They describe how a digital currency backed by the Federal Reserve could augment automatic fiscal stabilizers and—more importantly—harness the power of “helicopter” money or quantitative easing directly to consumers in a disciplined manner. To implement QE directly to consumers, Coronado and Potter propose the creation of recession insurance bonds (RIBs)—zero-coupon bonds authorized by Congress and calibrated as a percentage of GDP sufficient to provide meaningful support in a downturn. Congress would create these contingent securities; Treasury would credit households’ digital accounts with them. The Fed could purchase them from households in a downturn after its policy rate hits zero. The Fed’s balance sheet would grow by the value of RIBs purchased; the initial matching liability would be deposits into the DPP system. The mechanism is easy for consumers to understand and could boost inflation expectations more than a debt-financed fiscal stimulus could.
Topic:: Economics, Government, Monetary Policy, and Insurance
Political Geography:: North America and United States of America

141. What might have been: Globalization on the medal stand at the Tokyo Olympics

Author:: Soyoung Han and Marcus Noland
Publication Date:: 04-2020
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The Summer Olympic Games are the most globalized sporting event on earth. Until now, the Summer Games had been postponed only three times—in 1916, 1940, and 1944—all because of world wars. So, the announcement that in response to the COVID-19 pandemic, the 2020 Tokyo Games would be postponed by a year is significant, implicit testimony to the destructiveness of the pandemic. The Tokyo Games were expected to continue the evolution of the Games away from the aristocratic European milieu where the modern Olympic movement began. As poverty has declined and incomes across the global economy have converged, participation in the Games has broadened and the pattern of medaling has become more pluralistic, particularly in sports with low barriers to entry in terms of facilities and equipment. This Policy Brief presents forecasts of medal counts at the 2020 Tokyo Summer Games had they had gone on as scheduled, setting aside possible complications arising from the coronavirus pandemic. The forecasts are not just a depiction of what might have been. They establish a benchmark that can be used when the Games are eventually held, to examine the impact of the uneven incidence of the pandemic globally.
Topic:: Economics, Globalization, Sports, and Olympics
Political Geography:: Japan, Asia, and Global Focus

142. A New Policy Toolkit Is Needed as Countries Exit COVID-19 Lockdowns

Author:: Olivier Blanchard, Thomas Philippon, and Jean Pisani-Ferry
Publication Date:: 06-2020
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The measures that most governments took in response to the sudden collapse in economic activity during the COVID-19 lockdowns nearly exclusively focused on protecting vulnerable workers and firms. These measures included unemployment benefits, grants, transfers, loans at low rates, and tax deferrals. As lockdowns are lifted, governments must shift policies toward supporting the recovery and design measures that will limit the pain of adjustment while preserving productive jobs and firms. This Policy Brief explores how such measures can be designed, with particular emphasis on Europe and the United States. The authors propose a combination of unemployment benefits to help workers, wage subsidies and partially guaranteed loans to help firms, and debt restructuring procedures for small and medium-sized companies handicapped by excessive legacy debt from the crisis.
Topic:: Debt, Economics, Government, Labor Issues, Unemployment, and Coronavirus
Political Geography:: Europe, North America, and United States of America

143. Automatic stabilizers in a low-rate environment

Author:: Olivier Blanchard and Lawrence H. Summers
Publication Date:: 02-2020
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: With interest rates persistently low or even negative in advanced countries, policymakers have barely any room to ease monetary policy when the next recession hits. Fiscal policy will have to play a major and likely dominant role in stimulating the economy, requiring policymakers to fundamentally reconsider fiscal policy. Blanchard and Summers argue for the introduction of what they call “semiautomatic” stabilizers. Unlike purely automatic stabilizers (mechanisms built into government budgets that automatically—without discretionary government action or explicit triggers—increase spending or decrease taxes when the economy slows or enters a recession), semiautomatic stabilizers are targeted tax or spending measures that are triggered if, say, the output growth rate declines or the unemployment rate increases beyond a specified threshold. The authors argue that the trigger should be changes in unemployment rather than changes in output, and the design of semiautomatic stabilizers, whether they focus on mechanisms that rely primarily on income or on intertemporal substitution effects (changing the timing of consumption), depends crucially on the design of discretionary policy.
Topic:: Economics, Government, Monetary Policy, and Finance
Political Geography:: Global Focus and United States of America

144. COVID-19 and Peace: Preparedness for the post-pandemic recovery

Publication Date:: 06-2020
Content Type:: Policy Brief
Institution:: Institute for Economics & Peace (IEP)
Abstract:: The journey out of this global recession will be long and arduous. However two factors may assist countries along this path. The first is high levels of Positive Peace, guaranteeing effective institutions, social cohesion and transparent, representative governments. The second is favourable economic conditions before the onset of the pandemic.
Topic:: Conflict Prevention, Economics, Health, Global Recession, Violence, Economic Policy, Institutions, Peace, Pandemic, and COVID-19
Political Geography:: Global Focus

145. FDI another day: Russian reliance on European investment

Author:: Marta Dominguez-Jimenez and Niclas Poitiers
Publication Date:: 02-2020
Content Type:: Policy Brief
Institution:: Bruegel
Abstract:: Most foreign direct investment into Russia originates in the European Union: European investors own between 55 percent and 75 percent of Russian FDI stock. This points to a Russian dependence on European investment, making the EU paramount for Russian medium-term growth. Even if we consider ‘phantom’ FDI that transits through Europe, the EU remains the primary investor in Russia. Most phantom FDI into Russia is believed to originate from Russia itself and thus is by construction not foreign.
Topic:: Economics, Energy Policy, Foreign Direct Investment, Governance, Sanctions, European Union, and Global Political Economy
Political Geography:: Russia and Europe

146. Economic Priorities for a Sustainable Peace Agreement in Yemen

Author:: Zaid Ali Basha and Rafat Al-Akhali
Publication Date:: 06-2020
Content Type:: Policy Brief
Institution:: Sana'a Center For Strategic Studies
Abstract:: The sustainability of a peace agreement in Yemen depends on two critical economic issues. First, in a conflict that is largely over access to resources, the issues of distribution, control, and sharing of those resources can make or break peace. Therefore, these issues must be addressed head-on during negotiations. Second, where peace agreements lack provisions that create overall economic stability, warfare can resume during the fragile implementation period. The fears over the resumption of conflict after signing a peace agreement are substantiated by several historical events in Yemen, such as the failure of the GCC Initiative.
Topic:: Conflict Resolution, Economics, Natural Resources, Peacekeeping, Peace, and Economic Development
Political Geography:: Asia, Yemen, and West Asia

147. Developing Yemen’s Fishing Industry

Publication Date:: 04-2020
Content Type:: Policy Brief
Institution:: Sana'a Center For Strategic Studies
Abstract:: The fishing industry in Yemen faces many structural challenges that have limited its production and potential contribution to overall economic output. Development of the industry’s infrastructure, human capacity and regulation was already poor prior to the outbreak of the ongoing armed conflict in Yemen. Since the war began five years ago the fishing industry has faced increased challenges, including a significant drop in the level of production with the displacement of many fishermen and associated workforce; fish processing plants halting production; surging fuel costs; the decline of local purchasing power leading to a drop in the local demand for fish products; and the disempowerment of the Ministry of Fish Wealth (MFW), among other challenges.
Topic:: Economics, Oceans and Seas, Economic Development, and Fishing
Political Geography:: Asia, Yemen, and West Asia

148. Developing Human Capital

Publication Date:: 01-2020
Content Type:: Policy Brief
Institution:: Sana'a Center For Strategic Studies
Abstract:: This policy brief summarizes discussions regarding Yemen’s human capital at a “Rethinking Yemen’s Economy” workshop held in Amman, Jordan, on August 24-25, 2019. The workshop participants agreed that Yemen’s human capital accumulation has almost certainly regressed since the current conflict began. However, there is a dearth of reliable data to assess the scope and nature of this regression and thus how to best direct responses. There was also a consensus that many of the obstacles to improving Yemen’s human capital were present prior to the current conflict. In line with these findings, this brief recommends: countrywide population surveys; more funding of development projects over emergency humanitarian assistance; education reforms; and the targeting of sectors with high human capital returns. Crucially, policymakers should not wait for the end of the conflict to implement these recommendations. Investment in Yemen’s human capital now, specifically in geographic areas away from frontline fighting, should hasten the speed of the post-conflict economic recovery and lay the foundations for the sustainable development of the economy beyond the war.
Topic:: Economics, Human Capital, and Economic Development
Political Geography:: Asia, Yemen, and West Asia

149. Emerging from COVID: Policy Responses to the Pandemic

Author:: Ben Bland, Alexandre Dayant, John Edwards, Stephen Grenville, Natasha Kassam, Herve Lemahieu, Alyssa Leng, Richard McGregor, Shane McLeod, Alex Oliver, Jonathan Pryke, Roland Rajah, Sam Roggeveen, and Sam Scott
Publication Date:: 06-2020
Content Type:: Policy Brief
Institution:: Lowy Institute for International Policy
Abstract:: The fight against COVID-19 has been the greatest challenge the world has faced since the middle of last century. As countries have fought to control the disease, they have closed borders, quarantined their citizens, and shut down economies almost entirely. The ramifications will reverberate for years, if not decades, to come. In April 2020, the Lowy Institute published a digital feature in which twelve Institute experts examined the ways in which the COVID crisis would affect Australia, the region and the world. In this new feature, Lowy Institute experts provide policy recommendations for Australia to address issues that are critical to our nation’s — and the world’s — successful emergence from the pandemic. Countries have turned inwards in an attempt to fend off the threat of an infection that is oblivious to borders. Some have seen globalisation as the cause of the crisis, and have focused on solving problems without recourse to the international institutions of global security and prosperity, including the United Nations, the World Health Organization, and the G20. Yet global problems require international solutions. As the world emerges from the crisis, cooperation between nations will be more important than ever. Nation states cannot revive their economies purely through national solutions. They cannot address global threats, including the possibility of further pandemics, alone. Australia’s achievements in managing the COVID crisis have been exemplary. It has handled the health and economic emergency with great competence. But this is just the beginning of our crisis recovery. The challenges in our region, and the global problems that existed before COVID, have only been exacerbated by the pandemic. Australia has already done much to address the domestic economic and health issues from the COVID crisis. But to shape a prosperous and secure future, it will also need to work in cooperation with other nations, large and small, allies and partners, on a much broader array of international issues ranging from the economic disruption across the region, pressure from China on trade, and development challenges in the Pacific, to increasingly competitive relations between the United States and China, the weakening of the World Health Organization, and the declining utility of the G20.
Topic:: Diplomacy, Economics, Health, World Health Organization, G20, Geopolitics, COVID-19, and International Order
Political Geography:: China, Indonesia, Australia, and United States of America

150. Keeping Indonesia's economy afloat through the COVID-19 pandemic

Author:: Roland Rajah and Stephen Grenville
Publication Date:: 07-2020
Content Type:: Policy Brief
Institution:: Lowy Institute for International Policy
Abstract:: The principal economic problem facing Indonesia amid COVID-19 is financing the budget deficit needed to respond to a once-in-a-lifetime shock. In a world of self-help, Indonesia has been right to turn to Bank Indonesia, which could establish a clear policy of yield curve stabilisation as a basis for providing a readily scalable amount of deficit financing. Key bilateral partners, such as Australia, could complement this by providing a large standby loan facility to help reduce some of the inherent risks of Indonesia relying on its central bank.
Topic:: Economics, Budget, Banks, and COVID-19
Political Geography:: Indonesia, Australia, and Southeast Asia

151. Central Bank Digital Currencies: Tools for an Inclusive Future?

Author:: Eve Lee
Publication Date:: 09-2020
Content Type:: Policy Brief
Institution:: Belfer Center for Science and International Affairs, Harvard University
Abstract:: Central Bank Digital Currencies (CBDCs) have rapidly evolved from a sci-fi concept to a plausible alternative to cash that is being studied by central banks all over the world. According to a Belfer Center tracker, over 50 central banks have pursued or are engaging in CBDC work as of August 2020. However, while 10 central banks have already piloted or announced plans to pilot a CBDC in the near term, most are in the early stages of research and experimentation. In this brief, we outline the common motivations driving central bank work on CBDCs. We then explore CBDCs’ potential impacts on financial inclusion, a primary motivation in developing and emerging markets that has also gained significant traction in developed economies during the COVID-19 related global recession. We conclude that for CBDCs to achieve its financial inclusion goals, more technical advancement in offline adaptability and policy deliberations around issues of identity and traceability are needed.
Topic:: Diplomacy, Economics, International Trade and Finance, International Affairs, and Monetary Policy
Political Geography:: Global Focus

152. China’s National Carbon Market: Paradox and Potential

Author:: Cecilia Springer
Publication Date:: 12-2020
Content Type:: Policy Brief
Institution:: Belfer Center for Science and International Affairs, Harvard University
Abstract:: China announced it would launch a national carbon market in 2017, yet this policy is taking years to come into effect. What will it take for a carbon market to work in command-and-control China? This policy brief explores an understudied challenge—emissions accounting—and identifies potential opportunities that have arisen in the first phase of China’s national carbon market.
Topic:: Climate Change, Economics, Energy Policy, Environment, Natural Resources, and Carbon Emissions
Political Geography:: China and Asia-Pacific

153. Measuring Russia’s attention to Europe and the world

Author:: Kristian Lundby Gjerde
Publication Date:: 12-2020
Content Type:: Policy Brief
Institution:: Norwegian Institute of International Affairs
Abstract:: Based on a mapping of mentions of country names in more than 30,000 Russian official speeches, press conferences, meeting transcripts, and official statements, this brief provides insights into changes to Russia’s engagement with the world during the 21st century. Without disentangling the subtleties of relations – such as their security, economic, or cultural dimensions and their benign or adversarial features – this approach allows the brief to sketch answers to questions that would otherwise be left to guesswork.
Topic:: International Relations, Security, Economics, and Culture
Political Geography:: Russia, Europe, and Eurasia

154. The EU’s Role in Addressing Lebanon’s Multiple Crises

Author:: Shahin Vallée
Publication Date:: 09-2020
Content Type:: Policy Brief
Institution:: German Council on Foreign Relations (DGAP)
Abstract:: The Beirut Port blast (BPB) has revealed the fundamental failure of the Lebanese political system, but deep democratic reforms will take time and are fraught with risks. Given the US withdrawal and the extreme tensions in the region, the EU has a critical role to play in addressing the short-term humanitarian crisis, responding to the economic and financial situation, and providing a forum for civil society empowerment. If it fails to do so, the price is further geopolitical destabilization.
Topic:: Economics, European Union, Geopolitics, Finance, Crisis Management, and Destabilization
Political Geography:: Europe, Middle East, and Lebanon

155. Today’s Infrastructure Improvements Will Drive Tomorrow’s Economy

Author:: Committee for Economic Development of the Conference Board
Publication Date:: 03-2020
Content Type:: Policy Brief
Institution:: The Conference Board
Abstract:: Few issues enjoy such broad bipartisan consensus as the failings of American infrastructure. Roughly two-thirds of Americans rate their own local roads as only in fair or poor condition, and a similar proportion say that the country is not doing enough to meet infrastructure needs, making infrastructure a top-tier issue in 2020. With Treasury Secretary Steven Mnuchin signaling that infrastructure spending is a priority for the administration if economic stimulus is required to address slowdowns in the economy due to COVID-19, the US approach to infrastructure projects is poised to become an even more pressing issue. Modern, effective infrastructure is an essential requirement for national commerce—and for growing and widely shared prosperity—even as changes in technology drive changes in infrastructure requirements. While definitions vary, a 2019 Trump administration executive order defined infrastructure projects as those relating to surface transportation; aviation; ports; water resources projects; energy production, generation, storage, transmission, and distribution; broadband internet; pipelines; stormwater and sewer infrastructure; drinking water infrastructure; and cybersecurity. Efficient investment in cutting-edge infrastructure connects businesses and workers to more opportunities, increases productivity, and undergirds American competitiveness. Thus, US infrastructure is vital to sustain capitalism and maintain US economic leadership. However, the US routinely lags other advanced nations in infrastructure quality and, when considering the size of its economy, infrastructure investment.
Topic:: Economics, Infrastructure, and Economy
Political Geography:: North America and United States of America

156. Promoting Women's Economic Activity in Jordan

Author:: Allison Jacobs Anderson
Publication Date:: 12-2020
Content Type:: Policy Brief
Institution:: The Washington Institute for Near East Policy
Abstract:: Low women's employment in Jordan is perplexing given the kingdom's middle-class attributes. Creativity in U.S. development initiatives could deliver lasting gains. In Jordan, a mere 14 percent of women are formally employed, compared to the global average of 51 percent. This outcome is somewhat perplexing given the Hashemite Kingdom’s relatively high education levels for women, declining fertility rates, high average marriage age, and other attributes of a middle-class society. Jordan watchers have therefore searched for a cause. One common explanation centers on cultural constraints, including pressure to stay home, families disapproving of vocational jobs, and concerns about women working in mixed-gender environments. But an alternative view suggests these concerns may be overstated, in part owing to recognition of the essential role women can play in a fragile economy. In this new Policy Note, Dr. Allison Jacobs Anderson, an expert on gender and development, makes the case for encouraging greater women’s economic participation in Jordan. She outlines the many associated personal and societal benefits, and shows how a creative approach by U.S. development entities could deliver lasting gains.
Topic:: Economics, Labor Issues, Women, and Participation
Political Geography:: Middle East and Jordan

157. The Networking Strategy of Contemporary Chinese Diplomacy

Author:: Jai Chul Heo
Publication Date:: 07-2020
Content Type:: Policy Brief
Institution:: Korea Institute for International Economic Policy (KIEP)
Abstract:: China is actively building Network Power in economic and traditional security and non-traditional security areas, while in some cases maximizing its own interests by using the Network Power already formed. In particular, China is building Collective Power at a rapid pace in significant areas. China also actively participated in existing networks and established Positional Power by preoccupying important positions. However, China’s Network Power still seems to have a long way to go in terms of Programming Power to build new systems, unlike Collective or Positional Power. What is notable in the process of analyzing China’s Network Power is that competition between the U.S. and China is fierce over Network Power.
Topic:: Security, Diplomacy, Economics, and Power Politics
Political Geography:: China, Asia, and United States of America

158. Belt and Road Initiatives: China and South Korea's Economic Ties with South Asia and Nepal

Author:: Bama Dev Sigdel
Publication Date:: 04-2020
Content Type:: Policy Brief
Institution:: Korea Institute for International Economic Policy (KIEP)
Abstract:: The main objective of this article is to assess the effect of the Belt and Road Initiative (BRI) in terms of economic interrelations between Asian countries mainly China, Korea, India and Nepal. China’s Belt and Road Initiative (BRI) is one of the most ambitious economic strategies in modern times that alters the economic, political and social relationship between Eastern and Western societies. It not only improves transport networks and facilitates trade, but also raises GDP of many economies. For China, BRI manifests its intention to become the next global power through bigger market access and economic opportunities. Although South Asia is less developed economically, it has high strategic utility for the BRI, which has drawn attention from China to deepen its relations in the region. On the other hand, South Korea has also emerged as a soft power in Asia. It has been playing a significant role in Asia by contributing the majority of its aid, i.e., 35 per cent in Asian economies and a major share of its FDI, i.e., 34.1 per cent. With the rapidly increasing growth of South Korea, it also has a growing relationship with ASEAN and other South Asian economies such as India to reduce its dependence on traditional trade allies. Moreover, for least developed economies like Nepal, the BRI can bring improved infrastructure, needed technology, managerial talents and greater connectivity to the world. South Korea can yield higher benefits through its relation with South Asia and especially Nepal through expansion of export and market access, access to cheap workable manpower to cope with its rising aging population, and less dependence on traditional allies through its investment in South Asian region.
Topic:: International Relations, Economics, Economy, and Belt and Road Initiative (BRI)
Political Geography:: China, South Asia, Asia, South Korea, and Nepal

159. Economic recovery and climate: for Europe and the world, two battles to fight at once

Author:: Clémence Pèlegrin
Publication Date:: 12-2020
Content Type:: Policy Brief
Institution:: Robert Schuman Foundation (RSF)
Abstract:: The global economic and sanitary situation has accelerated many States’ commitments to fight climate change and, more specifically, the inclusion of climate issues in national recovery plans. Almost a year after the announcement of the Green Deal by the European Commission, and several weeks after ambitious climate announcements made by China and Japan, Europe will be playing an important round in its commitments at the forthcoming European Council on 10th and 11th December.
Topic:: Climate Change, Economics, Carbon Emissions, and Economic Recovery
Political Geography:: Europe

160. Chinese investment in Uganda: new impetus for sustainable development?

Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Advocates Coalition for Development and Environment (ACODE)
Abstract:: Chinese investment is flowing fast into Uganda, and spreading into the agriculture and forestry sectors. The government needs to keep pace with these developments so the benefits can be shared by Ugandans. A new analysis shows that, while the jobs and new businesses created are well received, the working conditions and environmental practices of Chinese companies are often poor. Many people evicted from their land to make way for new projects have not been compensated. To hold Chinese companies to account, government agencies, with support from NGOs, must share information about these investments and introduce stronger regulation — in particular to uphold community rights. In turn, Chinese companies must be more transparent, responsible and legally compliant. With a proactive and accountable strategy for Chinese investment management, Uganda could make major gains for sustainable development.
Topic:: Development, Economics, International Trade and Finance, Foreign Direct Investment, Business, Accountability, Investment, and NGOs
Political Geography:: Uganda, Africa, and China

161. Participation in Non-Farm Activities in Rural Sudan: Patterns and Determinants

Author:: Ebaidalla M. Ebaidalla
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: African Economic Research Consortium (AERC)
Abstract:: Despite the importance of non-farm income in the livelihood of the rural population in Sudan, information available on its size and determinants is scant. This study examined the patterns and determinants of decisions to participate in non-farm activities in rural Sudan. It also investigates whether the determinants of participation in non-farm activities vary across agriculture sub-sectors and income groups as well as among males and females. The data for this study was sourced from the Sudanese National Baseline Household Survey (NBHS) conducted by Sudan’s Central Bureau of Statistics in 2009. The results show that non-farm income is a crucial source of livelihood, contributing about 43% to household income in rural Sudan. The results of multinomial logit and probit estimation methods indicate that educational level, mean of transportation, lack of land and lack of access to formal credit are the most significant factors that push rural farmers to participate in non-farm activities. Surprisingly, the effect of household income was positive and significant, implying that individuals from rich households have higher opportunity to engage in non-farm activities compared to their poor counterparts. Moreover, the analysis revealed some symptoms of gender and location disparities in the effect of factors that influence participation in non-farm activities. The study concluded with some recommendations that aim to enhance the engagement in non-farm activities as an important diversification strategy to complement the role of the agriculture sector in improving rural economy in Sudan.
Topic:: Agriculture, Economics, Gender Issues, Income Inequality, and Rural
Political Geography:: Africa and Sudan

162. Determinants and Economic Impact of International Tourist Arrivals in Ghana

Author:: Isaac Bentum-Ennin
Publication Date:: 08-2019
Content Type:: Policy Brief
Institution:: African Economic Research Consortium (AERC)
Abstract:: Given Ghana’s endowments such as attractive sites; more than 500km of beaches, and World Heritage forts and castles, tourism is seen as an important tool for promoting the socio-economic development in that it generates many economic benefits such as incomes, employment and tax revenue, both within the sector and through linkages with other sectors. This study first, analyses the factors influencing the upward trends in international tourists’ arrivals and receipts and second, quantifies the impact of the tourism sector on the Ghanaian economy. The objective of this policy brief is to inform the Ministers of Interior, Tourism and Finance that the most important factor influencing international tourists’ arrivals in Ghana is the prevailing civil liberties and political rights and that Nigeria is a significant substitute destination. Also, that the tourism sector has had the greatest impact on the whole Ghanaian economy when compared to sectors such as agriculture, industry and other services sectors. It is hoped that appropriate legislations will be passed to deepen these liberties and rights and that policy measures will be put in place to ensure macroeconomic stability in order not to lose competitiveness to Nigeria. Also, it is hoped that the Tourism Ministry would lobby for more investment and more resources from the Finance Ministry in order to expand the sector since it has a huge potential to stimulate economic growth.
Topic:: Agriculture, Development, Economics, International Political Economy, Tourism, Economic Growth, and Macroeconomics
Political Geography:: Africa and Ghana

163. Performance of Small and Medium-Sized Enterprises in Uganda: The Role of Innovation

Author:: Ibrahim Okumu and Faizal Buyinza
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: African Economic Research Consortium (AERC)
Abstract:: Using the 2013 World Bank Enterprise Survey data for Uganda, this paper employs the quintile estimation technique to explain the relationship between innovation and firm performance in small and medium-sized enterprises (SMEs). Innovation involves the introduction of a new or significantly improved production process, product, marketing technique or organizational structure. Our results indicate that individual processing, product, marketing and organizational innovations have no impact on labour productivity as proxied by sales per worker. However, the results indicate the presence of complementarity between the four types of innovation. Specifically, the effect of innovation on sales per worker is positive when an SME engages in all four types of innovation. Even then the complementarity is weakly positive with incidences of a negative relationship when using any combination of innovations that are less than the four types of innovation. Policy-wise the results suggest that efforts to incentivize innovation should be inclusive enough to encourage all four forms of innovation.
Topic:: Development, Economics, International Political Economy, Economic Growth, and Economic Policy
Political Geography:: Uganda and Africa

164. Household Economic Well-Being and Child Health in The Democratic Republic of Congo

Author:: Janvier Mwisha-Kasiwa
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: African Economic Research Consortium (AERC)
Abstract:: Health is both a direct component of human well-being and a form of human capital that increases an individual’s capabilities and opportunities to generate income and reduces vulnerability. It is argued that these two views are complementary, and both can be used to justify increased investment in health in developing countries. Therefore, investment in child health constitutes a potential mechanism to end the intergenerational transmission of poverty. This paper examines the empirical impact of household economic well-being on child health, and the gender differences in effects using the Demographic and Health Survey conducted in 2014. A series of econometric tools are used; the control function approach appears to be the most appropriate strategy as it simultaneously removes structural parameters from endogeneity, the sample selection and heterogeneity of the unobservable variables. Results suggest a significant positive effect of household economic well-being on child health. However, the magnitude of the effect varies by gender of household head; children from households headed by males appear healthier compared to those from female-headed households. In the context of DR Congo, female-headed households often have a single parent, therefore, the economic well-being effect on child health in the male sub-sample can be considered to include the unobserved contribution of women. These results have implications for public interventions that enable women to participate in paid labour market activities as a means of improving household economic well-being, which in turn could improve child health.
Topic:: Development, Economics, Gender Issues, Health, Health Care Policy, and Children
Political Geography:: Africa and Democratic Republic of Congo

165. The Productivity Cost of Power Outages for Manufacturing Small and Medium Enterprises in Senegal

Author:: Lassana Cissokho
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: African Economic Research Consortium (AERC)
Abstract:: This paper investigates the productivity effects of power outages on manufacturing Small Scale Enterprises (SMEs) in Senegal, using a panel data on manufacturing firms. Productivity is estimated using stochastic frontier models, and power outages measured by their frequency or their duration. We controlled for firms owning a generator as well. The main results are drawn from random effects in a linear panel model. Nonetheless, the results remain consistent to the robustness checks using different models: a double-sided truncated data model and a generalized linear model, and different productivity measures: data envelopment analysis. We find that power outages have negative significant effects on the productivity of SMEs; for example, the manufacturing sector lost up to around 11.6% of the actual productivity due to power outages in 2011, and small firms appear to be affected more than medium ones, 5% against 4.3%. Further, firms with a generator were successful in countering the adverse effect of power outages on productivity. Besides, another outstanding result is the significant positive effect of access to credit on productivity. At last, it appears that productivity increases with firms’ size.
Topic:: Development, Economics, International Political Economy, Economic structure, Economic Growth, Macroeconomics, and Manufacturing
Political Geography:: Africa and Senegal

166. The Linkage between Foreign Direct Investment and Intra-Regional Trade within ECOWAS

Author:: Eme Dada
Publication Date:: 08-2019
Content Type:: Policy Brief
Institution:: African Economic Research Consortium (AERC)
Abstract:: The objective of this policy brief is to inform the Ministers of Trade and Investment of Economic Community of West African State (ECOWAS) countries about the importance of the linkage between Foreign Direct Investment (FDI) and trade for developing countries. FDI is considered an important means of promoting export of the host countries. This is true of inward FDI, which comes for efficiency reasons. Conversely, there is concern that large flows of outward FDI results in a decline in the host country’s exports and loss of jobs. This in turn assumes that the exports of the source country will fall as FDI substitutes for trade.
Topic:: Development, Economics, International Trade and Finance, Foreign Direct Investment, and Economic Growth
Political Geography:: Africa, Liberia, Sierra Leone, Senegal, Mali, Guinea, Guinea-Bissau, Cape Verde, and Gambia

167. Taxing “Bads”: An Overview of Research Initiatives

Author:: Ruth Lopert
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: Center for Global Development
Abstract:: Around the world, development economists and researchers are exploring proposals to tax excise goods, and several have produced models demonstrating that such taxes can generate substantial revenues. This note attempts to list the organizations and research initiatives currently addressing taxation of tobacco, alcohol, and sugar-sweetened beverages—the “bads”—to help navigate the landscape of existing research and identify gaps and opportunities for further work.
Topic:: Development, Economics, Tax Systems, and Revenue Management
Political Geography:: Global Focus

168. Economics for Inclusive Prosperity: An Introduction

Author:: Suresh Naidu, Dani Rodrik, and Gabriel Zucman
Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: We live in an age of astonishing inequality. Income and wealth disparities between the rich and the poor in the United States have risen to heights not seen since the gilded age in the early part of the 20th century, and are among the highest in the developed world. Median wages for American workers remain at 1970s levels. Fewer and fewer among newer generations can expect to do better than their parents. Organizational and technological changes and globalization have fueled great wealth accumulation among those able to take advantage of them, but have left large segments of the population behind. U.S. life expectancy has declined for the third year in a row in 2017, and the allocation of healthcare looks both inefficient and unfair. Advances in automation and digitization threaten even greater labor market disruptions in the years ahead. Climate change fueled disasters increasingly disrupt everyday life. Greater prosperity and inclusion both seem attainable, yet the joint target recedes ever further.
Topic:: Economics, Capitalism, Inequality, Economic Policy, and Economic Theory
Political Geography:: United States

169. Towards a Better Financial System

Author:: Anat R. Admati
Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: The financial system is fragile and distorted because current rules fail to counter the distorted incentives by banking institutions to borrow excessively and to remain opaque. Better-designed rules to reduce the reliance on debt and ensure that institutions use significantly more equity would enable the financial system to serve society better. Revising counterproductive tax and bankruptcy codes that, together with the extensive safety net offered to the financial system currently encourage dangerous conduct, would also be beneficial.
Topic:: Economics, International Trade and Finance, Finance, Economic Policy, Economic Theory, and Macroeconomics
Political Geography:: United States

170. An Expanded View of Government’s Role in Providing Social Insurance and Investing in Children

Author:: Sandra E. Black and Jesse Rothstein
Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: While private provision of goods often yields the efficient outcome, there are a number of goods that are not efficiently provided in the private market. Here, we outline two such situations: investments in child care and education, and insurance against risks created by business cycles, poor health, and old age. Because private markets work poorly for these goods, and the costs of market failure are large, standard economic reasoning implies a significant role for government provision. The reduction in economic insecurity that this would bring could help to improve political stability as well, by reducing the stakes that people perceive in discussions of trade, immigration, technological change, and countercyclical policy (Inglehart and Norris, 2016). Many observers (e.g, Hacker, 2018) have pointed to economic anxiety as a potential contributor to populist reactions in the U.S. and many European countries; a public sector that acts to reduce the risk that households face could ameliorate this, generating political spillovers and improving the state of the country more broadly.
Topic:: Economics, Education, Health, Health Care Policy, Children, Economic Policy, and Economic Theory
Political Geography:: United States and Europe

171. Election Law and Political Economy

Author:: Ethan Kaplan
Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: In sum, political institutions in the United States favor higher income individuals over lower income individuals and ethnic majorities over ethnic minorities. This is accomplished through a myriad of policies which impact who votes, allow for differential influence and access by the wealthy, structure voting districts to dilute the impacts of under-represented voters, and allow for oversized influence of pro-business owner ideas through media and membership organizations.
Topic:: Economics, Law, Elections, Democracy, Economic Policy, and Voting
Political Geography:: United States

172. Labor in the Age of Automation and Artificial Intelligence

Author:: Anton Korinek
Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: As technology advanced in recent decades, it increasingly left workers behind and led to sharp increases in inequality. The current wave of progress in artificial intelligence is likely to accelerate these trends. This note lays out three complementary approaches to countering these developments. Firstly, since technological progress generates net gains for society as a whole, the winners could in principle compensate the losers and still be better off. Secondly, progress should be steered to minimize the losses of workers. Thirdly, there is an important role for government intervention in information technology to thwart the rise of monopolies that extract rents from society. The note concludes with some speculations on the impact of artificial intelligence increasingly rivaling human labor.
Topic:: Economics, Science and Technology, Labor Issues, Economic Policy, Macroeconomics, and Artificial Intelligence
Political Geography:: United States

173. How to think about finance?

Author:: Atif Mian
Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: There has been a major structural shift in financial markets since the 1980s. The world is awash in credit, and credit is cheaper than ever before. I discuss how increasing financial surpluses within parts of the economy have resulted in an expansion in the supply of credit, which has largely financed the demand-side of the real economy. This increasing reliance on “credit as demand” raises some serious policy questions going forward. I discuss the importance of equitable and inclusive growth, fair taxation system and risk-sharing in creating a financial system that promotes prosperity and stability.
Topic:: Economics, International Trade and Finance, Finance, Economic Policy, and Economic Theory
Political Geography:: United States

174. Worker Collective Action in the 21st Century Labor Market

Author:: Suresh Naidu
Publication Date:: 01-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: Private sector union density in the United States has fallen below 7%, but new historical evidence shows high union density played an important role in compressing the US income distribution at mid-century and lowering intergenerational income persistence. Other recent evidence on pervasive labor market power suggests that unions may be able raise wages without severe dis-employment effects, and may alleviate inefficient contracting problems. Despite substantial survey evidence indicating latent demand for unions, employers have successfully fought unionization efforts in rising service sectors, and a combination of legal restrictions and economic transformations have impaired the ability of US unions to solve collective action problems at the appropriate scale – an issue that economics may be able to help ameliorate.
Topic:: Economics, Labor Issues, Income Inequality, and Labor Policies
Political Geography:: United States

175. Confronting Rising Market Power

Author:: Jonathan B. Baker and Fiona Scott Morton
Publication Date:: 05-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: Rising market power in the U.S. economy is not just a microeconomic problem, as the textbook analysis shows, creating allocative efficiency losses and transferring wealth away from victimized participants in the affected markets. Rising market power also undermines inclusive prosperity by contributing to inequality and slowed economic growth. Modern economic research points to multiple ways to attack market power and enhance competition, including ways of strengthening antitrust enforcement, improving antitrust rules and institutions, and deploying regulation to enhance competition.
Topic:: Economics, Economic Policy, Economic Theory, Macroeconomics, and Microeconomics
Political Geography:: United States

176. Antitrust and Labor Market Power

Author:: José Azar, Ioana Marinescu, and Marshall Steinbaum
Publication Date:: 05-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: Starting with the Chicago School’s influence in the late 1970s and 1980s, antitrust enforcement has been weakened under the assumption that market power is justified by economic efficiency. While consumers are the main focus of antitrust enforcement, the weakening of antitrust enforcement has likely also adversely impacted workers, thus contributing to increasing inequality.
Topic:: Economics, Labor Issues, Economic Policy, Economic Theory, and Antitrust Law
Political Geography:: United States

177. It’s Good Jobs, Stupid

Author:: Daron Acemoglu
Publication Date:: 06-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: Progressive policy proposals that would have appeared radical just a few years ago, including high marginal tax rates, wealth taxes, universal basic income, single-payer health insurance, and free college for all, are now on the agenda. The recognition that we can do more to create shared prosperity — that is, economic growth benefiting society at large, not just corporations and the very well-educated — is a welcome development. But are we targeting the right policies? We are at a critical juncture both economically and politically. We do not have much time left to reverse the trend towards greater inequality and worsening economic prospects for less educated Americans before its social consequences become more deeply ingrained. And the 2020 presidential election may provide a unique opportunity to adopt fundamentally different economic policies. Failing to identify the right policy priorities would not only squander this critical juncture; it could also deepen the rift between the different wings of US politics.
Topic:: Economics, Labor Issues, Employment, Labor Policies, Economic Policy, and Economic Theory
Political Geography:: United States

178. Thoughts on Medicare for All

Author:: Ilyana Kuziemko
Publication Date:: 07-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: My read of the evidence (and my own social welfare weights, which place great weight on the un- and under-insured as well as middle-class workers who are implicitly taxed via expensive health plans) lead me to conclude that Medicare for All would increase welfare in the US. However, I also want to highlight what I consider the biggest risks of such a policy.
Topic:: Economics, Health, Health Care Policy, and Economic Policy
Political Geography:: United States

179. The Economics of Free College

Author:: David Deming
Publication Date:: 06-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: Despite growing public concern about the cost of college, higher education is still the best investment a young person can make. The American public understands that college is both increasingly necessary and increasingly unaffordable. This dynamic explains the growing public conversation around the idea of “free college”.
Topic:: Economics, Education, Economic Policy, and Higher Education
Political Geography:: United States

180. Carbon Pricing for Inclusive Prosperity: The Role of Public Support

Author:: David Klenert and Linus Mattauch
Publication Date:: 08-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: It is common knowledge among economists that the most efficient instrument to mitigate climate change is a price on carbon. However, current carbon prices around the world are too low to reach global climate targets. This essay assesses the difficulties in designing successful carbon pricing reforms. It discusses how to overcome these difficulties by combining traditional public economics lessons with findings from behavioral and political science. We stress insights from public finance about the “second-best” nature of pricing carbon reforms. Further, we highlight how framing a carbon tax reform around tangible benefits can enhance political support. Finally, we explain how certain countries were successful at introducing high carbon prices and what can be learned from these cases for making progress with climate change mitigation.
Topic:: Climate Change, Economics, Science and Technology, Natural Resources, Global Warming, Green Technology, and Economic Policy
Political Geography:: United States

181. Should We Worry About Corporate Leverage?

Author:: Şebnem Kalemli-Özcan
Publication Date:: 10-2019
Content Type:: Policy Brief
Institution:: Economics for Inclusive Prosperity (EfIP)
Abstract:: There has been a large increase in corporate leverage in many countries since the early 2000s. Figure 1 plots corporate debt to GDP since 2002 for different groups of countries. With the exception of the U.S., both advanced economies and emerging markets have corporate debt exceeding GDP since 2005. U.S. corporate debt is also on an increasing trend. The fastest growth in corporate debt has been observed in emerging markets. A closer look will reveal that China and other fast growing emerging countries in Asia drive most of the increase in corporate debt for the emerging markets.
Topic:: Debt, Economics, Markets, Regulation, Multinational Corporations, and Economic Policy
Political Geography:: United States and Global Focus

182. Counting the Cost of Financial Warfare: Recalibrating Sanctions Policy to Preserve U.S. Financial Hegemony

Author:: Enea Gjoza
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: Defense Priorities
Abstract:: The American economy, dollar, and banking system create unparalleled power for the U.S. in the global financial system. This power provides disproportionate influence over the world’s key economic and financial institutions, regulatory authority over major foreign companies and banks, and allows borrowing on favorable terms and in dollars, enabling long-term deficit spending.
Topic:: Economics, International Trade and Finance, Hegemony, Sanctions, Finance, and Global Political Economy
Political Geography:: United States

183. Angola under Joao Lourenço: Who Are the New Players of MPLA State?

Author:: Benjamin Augé
Publication Date:: 12-2019
Content Type:: Policy Brief
Institution:: Institut français des relations internationales (IFRI)
Abstract:: In 2017, the coming to power of João Lourenço put an end to nearly four decades of rule by the former head of state, José Eduardo Dos Santos. João Lourenço’s first objective was to strengthen his authority by appointing people close to him and cadres from the old regime, who had professed loyalty to him, to high office. The speed of the takeover of all the decision-making centers – army, intelligence services, state-owned companies, oil industry and above all the MPLA (Popular Movement for the Liberation of Angola) party-state – by the new “Comrade Number One” surprised the leaders of the Dos Santos era, some of whom were abruptly dismissed or even sentenced to prison. Now firmly established in Angola’s command centers, João Lourenço is however facing a serious economic crisis, the most worrying for the country since the end of the civil war in 2002.
Topic:: Economics, Politics, and Governance
Political Geography:: Africa and Angola

184. Economic Empowerment to Address Gender-Based Violence

Author:: SVRI
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: The Sexual Violence Research Initiative
Abstract:: Poverty is a risk factor associated with gender-based violence; it also often intersects with and reinforces gender inequality. Various microfinance and other economic empowerment approaches have been implemented to try to address this intersection.
Topic:: Economics, Gender Issues, Poverty, Women, Gender Based Violence, and Microcredit
Political Geography:: Bangladesh, Egypt, and Global Focus

185. Oman After Qaboos: A National and Regional Void

Author:: Simon Henderson
Publication Date:: 12-2019
Content Type:: Policy Brief
Institution:: The Washington Institute for Near East Policy
Abstract:: The ailing Sultan Qaboos bin Said al-Said, now seventy-nine years old, has no children and no announced successor, with only an ambiguous mechanism in place for the family council to choose one. This study considers the most likely candidates to succeed the sultan, Oman’s domestic economic challenges, and whether the country’s neutral foreign policy can survive Qaboos’s passing.
Topic:: Foreign Policy, Economics, Domestic Politics, and Succession
Political Geography:: Middle East, Oman, and Gulf Nations

186. Assessment of the Economic Costs of Electrical Power Outages in Swaziland

Author:: Eswatini Economic Policy Analysis and Research Centre
Publication Date:: 05-2019
Content Type:: Policy Brief
Institution:: Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:: Electricity access has improved significantly since introduction of the National Energy Policy of 2003. However, challenges in electricity supply still exist due to the frequency of interruptions, which has resulted in harsh penalties and costs to the economy. In 2016, power outages cost Swaziland E700 million in nominal monetary terms, representing 1.67% of Swaziland’s Gross Domestic Product (GDP). If not addressed, the problems with the electricity sector will severely undermine the government’s effort to improve the development of the country. In essence, the benefits of increased access to the electricity grid will not be realised if power supply is as unreliable as it currently is. Considerable effort should be made to ensure that the country’s electricity supply system is stable and uninterrupted. Hence, in order to achieve this, there is need for policy attention towards improving the energy sector through investments in electricity generation using renewable energy sources, expediting the promotion of decentralised electricity generation to vulnerable areas, and setting stringent standards for the generation and distribution of electricity.
Topic:: Economics, Energy Policy, Infrastructure, and Electricity
Political Geography:: Africa and Swaziland

187. Quantifying the Size and Development of the Shadow Economy in Swaziland

Author:: Eswatini Economic Policy Analysis and Research Centre
Publication Date:: 03-2019
Content Type:: Policy Brief
Institution:: Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:: The size of the shadow economy has been declining at a slow rate over the past 16 years in Swaziland. The size of the shadow economy was found to be 37.4 % in 2016. This was equivalent to E20.5 billion of the Gross Domestic Product (GDP) in 2016. The key drives of the shadow economy in Swaziland were found to be the tax burden (direct and indirect taxation), self-employment, the importance of the agricultural sector and the institutional quality of governance institutions. For the country to fast tract its developmental agenda (Vision 2022), it is important for the country to enact policies that will harness and transition the shadow economy into the mainstream economy by targeting the drivers of the shadow economy locally.
Topic:: Development, Economics, Governance, and GDP
Political Geography:: Africa and Swaziland

188. The Socio-Economic Impacts of the 2015/16 EL Niño Induced Drought in Swaziland

Author:: Eswatini Economic Policy Analysis and Research Centre
Publication Date:: 06-2019
Content Type:: Policy Brief
Institution:: Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:: The 2015/16 El Niño drought proved to be the worst drought Swaziland has experienced since 1992. In total nominal monetary terms, the drought cost Swaziland minimally E3.843 billion, representing a 7.01% of Swaziland’s Gross Domestic Product (GDP) in 2016 or 18.58% of government expenditure in 2016. Despite the significant drought losses, the country has on paper a solid Disaster Risk Management (DRM) Policy (2010). However, even with extensive experience from past droughts in 2009/10, 2007, 2001, and 1992, the country is still struggling to become drought proof. The reason Swaziland is so affected by drought is that the country’s economic backbone rests on agriculture. The inherent vulnerability to drought is that the food production system in the country is still highly dependent on direct rainfall. Due to chronic drought-like conditions in the Shiselweni and Lubombo regions, households in these regions are now discouraged from participating in agriculture. To illustrate, an assessment of agricultural assets in households reveals that household participation in agriculture is less than 30%, with a measly national average of 25.3%. As a result, the country is now too dependent on the international, basically South African, market for its basic food needs. The implication is that as droughts become more frequent, their impact on the country will be detrimental to the economy, particularly on rural livelihoods.
Topic:: Economics, Environment, Natural Disasters, Socioeconomics, and Drought
Political Geography:: Africa and Swaziland

189. The Economic Benefits of Technical and Vocational Education and Training (TVET) in the Kingdom of Swaziland: A case of the National Handicraft Training Centre (NHTC)

Author:: Eswatini Economic Policy Analysis and Research Centre
Publication Date:: 06-2019
Content Type:: Policy Brief
Institution:: Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:: Technical and Vocational Education and Training (TVET) in Swaziland is key for employment and self-employment opportunities which result in economic growth. TVET has proven to be an educational pathway that can be used to significantly reduce the unemployment rate by 2022. TVET graduates acquire skills that empower them to be immediately absorbed by the labour market and/or be self-employed. About 73.1% of the graduates are in productive employment after graduating from NHTC; with 47.6% formally employed, 25.5% self-employed, while 26.2% were unemployed in the period 1995 – 2015. The Benefit-Cost Ratio of NHTC, based on the Government of Swaziland and the Republic of China on Taiwan’s investment in NHTC, is 1:4.66. This means for every E1 invested in NHTC, the economy realises E4.66 through the income generating activities of graduates. The positive return on investment in NHTC indicates that if Government can increase funding to TVET institutions, the economic return can make significant contributions to skills development and GDP growth in the country.
Topic:: Economics, Education, Labor Issues, and Employment
Political Geography:: Africa and Swaziland

190. Hyperinflation in Venezuela: A Stabilization Handbook

Author:: Gonzalo Huertas
Publication Date:: 09-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The unrelenting surge in prices in Venezuela has crippled the economy and deepened the humanitarian crisis there. Huertas lays out a feasible stabilization plan to stop Venezuela’s hyperinflation. The extent of the humanitarian crisis and shortage of basic goods and services suggests that, on the fiscal side, a stabilization plan should focus primarily on reallocating rather than reducing spending. The authorities should avoid austerity policies and instead spend on taking care of the Venezuelan people. Stabilizing the price level while providing relief to the country’s population would require significant financial assistance from the rest of the world, so it is critical that Venezuela secure strong financial support from the international community. Successful stabilization requires a credible plan to transition to a responsible fiscal policy, the financial resources to carry it out, and the political will to sustain it.
Topic:: Security, Economics, Finance, Inflation, and Humanitarian Crisis
Political Geography:: South America and Venezuela

191. Global E-Commerce Talks Stumble on Data Issues, Privacy, and More

Author:: Gary Clyde Hufbauer and Zhiyaou (Lucy) Lu
Publication Date:: 10-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: In early 2019, several important members of the World Trade Organization (WTO) submitted noteworthy proposals in a realm of international commerce that has evolved faster than rules to govern it: e-commerce or digital trade. While countries agree on less controversial subjects like banning unsolicited commercial electronic messages, the three leading WTO members—China, the European Union, and the United States—have big differences in their approaches to more challenging issues: data flows, data localization, privacy invasions by data collectors, transfer of source code, imposition of customs duties and internet taxes, and internet censorship. Their differing viewpoints lead Hufbauer and Lu to conclude that the prospect of reaching a high-level WTO e-commerce agreement is not promising. To reach an agreement, either most of the contentious issues must be dropped or the number of participating countries must be sharply reduced. A WTO accord, even of low ambition, would have value if only to establish basic digital norms on matters such as banning unsolicited commercial messages and protecting online consumers from fraudulent practices. A more ambitious accord covering the controversial issues should be negotiated in bilateral and/or plurilateral/regional pacts rather than in the WTO.
Topic:: Economics, World Trade Organization, Finance, Privacy, and Data
Political Geography:: China, Europe, Asia, North America, United States of America, and European Union

192. Average Inflation Targeting Would Be a Weak Tool for the Fed to Deal with Recession and Chronic Low Inflation

Author:: David Reifschneider and David Wilcox
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The Federal Reserve faces two important monetary policy challenges: First, since the Great Recession it has struggled to move inflation convincingly up to the 2 percent target level. Second, during the next recession it will struggle to deliver enough support to the economy unless the recession is unusually mild. As a result, the search is on for alternative policy frameworks that might allow the Fed to achieve its monetary policy objectives more effectively. Among the alternatives is average inflation targeting (AIT). The basic idea is simple: Instead of aiming to return inflation over the medium term to the target rate of 2 percent, the Fed would aim to return the average of inflation over some period to the target rate. The crucial innovation of AIT is that when inflation has been running below the target rate, it would have the Fed aim for above-target inflation in the future, in order to bring average inflation up toward the target. Simulations of the Fed’s workhorse econometric model of the US economy (the FRB/US model) suggest that AIT would be a weak addition to the Fed’s policy toolkit for dealing with recessions and persistently low inflation. In addition, simple versions of AIT would sometimes compel the Fed to run an undesirably restrictive monetary policy. AIT is thus not a very appealing alternative to the current framework.
Topic:: Economics, Global Recession, Monetary Policy, and Federal Reserve
Political Geography:: North America, Global Focus, and United States of America

193. US-China Trade War: Both Countries Lose, World Markets Adjust, Others Gain

Author:: Sherman Robinson and Karen Thierfelder
Publication Date:: 11-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The terms of the US-China trade war change often, but the tariff escalations have inflicted documented economic damage on both countries. Expanding the conflict will only increase the damage and reverberate across the world economy. This Policy Brief uses a computable general equilibrium model of the global economy to analyze three scenarios that could unfold in coming months. The first scenario is the current situation (as of June 2019). Two additional scenarios assume implementation of proposed US tariffs and Chinese responses. The models project the situation after the two countries and the rest of the world adjust across a time horizon of three to five years. For the United States, higher tariffs raise prices and reduce demand for consumers and producers. For China, the tariffs raise the prices of consumer goods but have less direct impact on producers, because the Chinese have exempted some intermediate inputs. US exports and imports decline under all three scenarios. But China can successfully divert its exports away from the United States and escape maximum economic damage.
Topic:: Economics, Global Markets, Finance, Trade Wars, and Trade
Political Geography:: China, Asia, North America, and United States of America

194. Keeping Up with the Future: Upgrading Forecasts of Political Instability and Geopolitical Risk

Author:: Cullen S. Hendrix and Sooyeon Kang
Publication Date:: 07-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The nature and magnitude of geopolitical risk is changing more rapidly than the ability to anticipate it, with increasingly severe economic consequences. This Policy Brief discusses the economic costs and risks associated with episodes of political instability, arguing that firms, government agencies, and international institutions must update their forecasting and risk assessment efforts to take global factors into account. Since the global financial crisis, political instability has shifted from emerging-market countries in the developing world to larger, more globally impactful econo¬mies. Acknowledging this changing risk profile—and developing better tools to predict major episodes of instability—will allow both policymakers and firms to plan with greater confidence.
Topic:: Economics, Geopolitics, Economy, and Political stability
Political Geography:: Global Focus

195. Chinese Investments in the US and EU Are Declining—for Similar Reasons

Author:: Jacob Funk Kirkegaard
Publication Date:: 09-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: For years China has been one of the world’s most rapidly growing sources of outward foreign direct investment. Since peaking in 2016, however, Chinese outward investments, primarily to the United States but also the European Union, have declined dramatically, especially in response to changes in China’s domestic rules on capital outflows and in the face of rising nationalism in the United States. Concerns about growing Chinese influence in other economies, the ascendant role of an authoritarian government in Beijing, and the possible security implications of Chinese dominance in the high-technology sector have put Chinese outward investments under intense international scrutiny. This Policy Brief analyzes the most recent trends in Chinese investments in the United States and the European Union and reviews recent political and regulatory changes both have adopted toward Chinese inward investments. It also explores the emerging transatlantic difference in the regulatory response to the Chinese information technology firm Huawei. Concerned about national security and as part of the ongoing broader trade friction with China, the United States has cracked down far harder on the company than the European Union.
Topic:: Economics, International Trade and Finance, National Security, Foreign Direct Investment, and Investment
Political Geography:: China, Europe, Asia, North America, and United States of America

196. Fiscal Policy Options for Japan

Author:: Olivier Blanchard and Takashi Tashiro
Publication Date:: 05-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: For many years, the Japanese government has promised an eventual return to primary budget surpluses, but it has not delivered on these promises. Its latest goal is to return to primary balance by 2025. Blanchard and Tashiro, however, argue that, in the current economic environment in Japan, primary deficits may be needed for a long time, because they may be the best tool to sustain demand and output, alleviate the burden on monetary policy, and increase future output. What primary deficits are used for, however, is equally important, and the Japanese government should put them to better use. The authors recommend that, given Japan’s aging population, the government should spend on measures aimed at increasing fertility—and by implication population and output growth—which are likely to more than pay for themselves.
Topic:: Economics, Government, Budget, Fiscal Policy, and Deficit
Political Geography:: Japan and Asia

197. The Return of Economic Nationalism in Germany

Author:: Jeromin Zettelmeyer
Publication Date:: 03-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: ermany’s new National Industrial Strategy 2030, unveiled by Economy Minister Peter Altmaier in February 2019, advocates an aggressive industrial policy. Although it stays clear of the virulent economic nationalism of the 1930s and the protectionism of President Donald Trump, its tone and much of its content are unmistakably nationalist. Zettelmeyer concludes that three of Altmaier’s five proposals—attempting to further raise the German share of manufacturing, restricting non-EU imports of intermediate goods, and promoting national champions in Germany and the European Union—are bad policies. The two remaining ideas—preventing some foreign takeovers and ramping up state support for certain technologies—are somewhat easier to justify, based on either market failures or the risk of technological dependence on foreign companies susceptible to political interference. But even in these areas, the specific policies proposed may well do more harm than good.
Topic:: Economics, Nationalism, European Union, and Donald Trump
Political Geography:: Europe and Germany

198. Keeping Up with the Future: Upgrading Forecasts of Political Instability and Geopolitical Risk

Author:: Cullen S. Hendrix and Sooyeon Kang
Publication Date:: 07-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: The nature and magnitude of geopolitical risk is changing more rapidly than the ability to anticipate it, with increasingly severe economic consequences. This Policy Brief discusses the economic costs and risks associated with episodes of political instability, arguing that firms, government agencies, and international institutions must update their forecasting and risk assessment efforts to take global factors into account. Since the global financial crisis, political instability has shifted from emerging-market countries in the developing world to larger, more globally impactful econo¬mies. Acknowledging this changing risk profile—and developing better tools to predict major episodes of instability—will allow both policymakers and firms to plan with greater confidence.
Topic:: Economics, Financial Crisis, Geopolitics, Political stability, and Risk
Political Geography:: Global Focus

199. The Rise of Global Innovation by US Multinationals Poses Risks and Opportunities

Author:: Lee G. Branstetter, Britta Glennon, and J. Bradford Jensen
Publication Date:: 06-2019
Content Type:: Policy Brief
Institution:: Peterson Institute for International Economics
Abstract:: For decades, US multinational corporations (MNCs) conducted nearly all their research and development (R&D) within the United States. Their focus on R&D at home helped establish the United States as the unrivaled leader of innovation and technology advances in the world economy. Since the late 1990s, however, the amount of R&D conducted overseas by US MNCs has grown nearly fourfold and its geographic distribution has expanded from a few advanced industrial countries to many parts of the developing world, creating an innovation system that spans the globe. Like many aspects of globalization, including the offshoring of manufacturing over recent decades, the globalization of R&D raises concerns about US competitiveness and loss of technological leadership. At the same time, the spreading geographic location of innovation presents opportunities for US-based companies if the right policies are adopted to seize them. The research presented in this Policy Brief demonstrates that US innovators continue to remain involved in important ways in US MNCs' global R&D activities, and fears of a hollowing out of US capacity to innovate—based probably on previous fears about the hollowing out of US-based manufacturing—may be overstated. Indeed, the large and growing pool of highly educated scientists and engineers in the developing world could increase the rate of global productivity growth, to the advantage of US-based companies and the world in general. The authors conclude that a productive way to capitalize on the globalization of MNC R&D is not to oppose it but to combine emerging-market talent with MNC experience so that innovation can flourish to improve global living standards and fuel economic progress.
Topic:: Economics, Globalization, Multinational Corporations, Risk, and Innovation
Political Geography:: North America and United States of America

200. The role of Chinese finance in the City of London after Brexit

Author:: Sarah Hall
Publication Date:: 06-2019
Content Type:: Policy Brief
Institution:: Asia Research Institute, University of Nottingham
Abstract:: London is the largest western financial centre for financial transactions denominated in Renminbi (RMB) and has played an important role in shaping the rapid and recent internationalisation of Chinese finance. This policy brief discusses how to maintain this leading role post-Brexit.
Topic:: Economics, International Political Economy, Finance, Brexit, and Financial Institutions
Political Geography:: Britain, China, and United Kingdom

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