Economic Recovery or A Statistical Illusion: Some Observations on Recent Estimates of GDP Growth Vikas Rawal

On November 30th, the Central Statistical Office (CSO) came out with quarterly estimates of GDP for the second quarter (June to Sep) of 2017. Predictably, analysts and spokespersons of the government spent the evening in newsrooms of various TV channels celebrating what they claimed was a sign of revival of the economy. Next morning, revival of economy was the front page news in almost every newspaper. If there was any adverse impact of demonetisation and GST, it was claimed, here was the evidence that such an impact was only short-term and had started to wane. The subtext was that the…

More Public Spending, Not Tax Cuts, for Sustainable, Inclusive Growth Jomo Kwame Sundaram and Anis Chowdhury

The Trump administration's promise to increase infrastructure spending should break the straightjacket the Republicans imposed on the Obama administration after capturing the US Congress in 2010. However, in proportionate terms, it falls far short of Roosevelt's New Deal effort to revive the US economy in the 1930s. To make matters worse, reducing budget deficits remains the main economic policy goal of all too many OECD governments. Governments tend to cut social spending if they can get away with it without paying too high a political price. But OECD governments' belief that social spending -- on health, education, childcare, etc. --…

Fiscal austerity has been blocking economic recovery Jomo Kwame Sundaram

Instead of concerted and sustained efforts for a strong, sustained economic recovery to overcome protracted stagnation, the near policy consensus on fiscal austerity in the G7 and the G20 OECD countries, except for the US and Japan, has dragged down economic recovery in developing countries. After seven years of lackluster economic performance and rising tensions over the Eurozone straightjacket on fiscal stimuli, there are signs of a growing willingness to reconsider earlier policies. While it is not yet clear whether this will lead to significant enough policy changes, this may well led to the long awaited turning point the world…

Wage and Fiscal Policies for Economic Recovery Jomo Kwame Sundaram and Anis Chowdhury

The new US census data released in late September show that 3.5 million people in the US climbed out of poverty, as the tepid economic recovery continues. Employers are finally creating more jobs and paying higher wages than seven years after the Great Recession started following the 2008 financial crisis. This progress, while modest, debunks the claims of those who predicted a dire outcome following the increase in the legislated US minimum wage, especially without a robust recovery. The data show large employment and wage gains, particularly for the lower end of the jobs spectrum. Raising the legal minimum-wage and…

Is Sustainable Development Hindering Economic Recovery? Jomo Kwame Sundaram

The global economic and employment situation is alarmingly protracted, with recovery not expected any time soon. In October 2012, then IMF chief economist Olivier Blanchard indicated he did not see a global economic recovery before 2016. Now, in mid-2016, it is clear that the global crisis has dragged on for several reasons; many governments, especially in advanced economies, still prioritize fiscal austerity and tough labour market reforms, even though such measures undermine livelihoods, incomes, the social fabric and economic recovery prospects. Meanwhile, despite ‘quantitative easing', investments remain depressed, blocking employment creation. Easy credit before the crisis led to over-investment in…

Robust Global Economic Recovery Needs Coordinated Policy Response Anis Chowdhury and Jomo Kwame Sundaram

In the wake of releasing the IMF’s latest assessment of the global economy, Chief Economist Maurice Obstfeld noted in his blog, “Global growth continues, but at an increasingly disappointing pace that leaves the world economy more exposed to negative risks. Growth has been too slow for too long.” The IMF anticipates 3.2% global economic growth this year, down from 3.4% predicted in January, 3.6% last October and 3.8% last April. Nonetheless, this continuously downward revised forecast is still higher than the United Nations global growth forecast of 2.9% and 3.2% in 2016 and 2017 respectively early this year. ‘Solution’ is…

A Note on the Nature and Sources of Chinese Recovery Vineet Kohli

With the help of data for the first three quarters of 2009, this note seeks to examine the nature of Chinese recovery. Three features of the Chinese recovery process are undeniable: the recovery has been state led, investment led and tertiary sector led. Stock and real estate market booms have accompanied the growth process but do not seem to be the major drivers of growth in this period. China_Recovery (Download the full text in PDF format)  

Progressive Program For Economic Recovery & Financial Reconstruction Michael Ash, Radhika Balakrishnan, James Crotty, Edwin Dickens, Gerald Epstein, Thomas Ferguson, Teresa Ghilarducci, Jo-Marie Greisgraber, Stephany Griffith-Jones, Robert Guttmann, Arjun Jayadev, Anush Kapadia, David Kotz, Michael Meerepol, William Milberg, Fred Moseley, Jose Antonio Ocampo, Robert Pollin, Malcolm Sawyer and Martin Wolfson

The global economic crisis is rapidly worsening. Meanwhile the incoming Obama administration is intensively developing plans to ward off economic catastrophe. In this atmosphere of hope laced with tremendous uncertainty, a group of progressive economists met on November 21, 2008 at the New School for Social Research in New York for a discussion, sponsored by the Political Economy Research Institute (PERI) of the University of Massachusetts, Amherst and the New School’s Schwartz Center for Economic Policy Analysis (SCEPA), with financial support from the Ford Foundation. The goal of the meeting was to discuss macroeconomic and financial policies for economic revival…

Argentina Since Default: The IMF and the depression Alan B. Cibils, Mark Weisbrot and Debayani Kar

More than eight months since the economic crisis has passed and Argentina's economy continues to decline, with the recession now having lasted more than four years. This paper looks at Argentina's crisis since the default in an attempt to find a way out of the Depression. argentina_default (Download the full text in PDF format)