China’s Stock Market Collapse Jayati Ghosh

The recent rout in the Chinese stock market – and the Chinese authorities' increasingly panicky responses to it that temporarily halted the decline – may not seem all that important to some observers. Indeed, there are analysts who have said that this is just the typical behaviour of a still immature stock market that is still “froth” in the wider scheme of things, and not so significant for real economic processes in China. After all, the Chinese economy is still much more state-controlled than most, the main banks are still state-owned and stock market capitalization relative to GDP is still…

Catching Up and Knowledge Governance Rainer Kattel

The author provides a theoretical framework that makes it possible to create a taxonomy of knowledge governance regimes and elucidate what is needed for catching-up strategies. Knowledge_Governance (Download the full text in PDF format) (This chapter has been published in the volume “Knowledge Governance: Reasserting the Public Interest,” edited by Leonardo Burlamaqui, Ana Célia Castro and Rainer Kattel. London: Anthem Press, 2012. ISBN: 9780857285355.)

From Liberalization to Investment and Jobs: Lost in tsssranslation Yilmaz Akyüz

This paper discusses the experience of late industrializers in harnessing profits through industrial-cum-investment policies for faster accumulation. It is found that the performance of a large number of developing countries which have adopted a strategy of reigniting a dynamic process of capital accumulation and growth through a combination of rapid liberalization, increased reliance on foreign capital and reduced public investment and policy intervention is highly disappointing. The paper also examines the impact of macroeconomic and financial policies on accumulation, employment and growth, and concludes with a discussion of policy priorities. lost_translation (Download the full text in PDF format)

The Economic and Social Effects of Financial Liberalization: A primer for developing countries Jayati Ghosh

This paper considers and critiques the theoretical arguments in favour of financial liberalization and also discusses the political economy of such measures. It goes onto analyze the specific problems for developing countries, with respect to financial fragility and the greater propensity to crisis, as well as the negative deflationary and developmental effects. social_effects (Download the full text in PDF format)

The Fraudulent World of US Finance C.P. Chandrasekhar

In what now appears routine, a leading investment bank in the US has been indicted for fraud. On Monday May 16th, 2005, a Florida jury ruled that Morgan Stanley had acted in bad faith and defrauded erstwhile corporate raider and beleaguered financier Ronald O. Perelman in 1998. In the first instance it required Morgan Stanley to pay Perelman $604 million in compensation. Two days later, the jury ordered Morgan Stanley to pay a further $850 million in punitive damages. This took the total awarded to Perelman to $1.45 billion. For Morgan Stanley, the punitive damage payments far exceeded a recent…

Banking FDI in Latin America: An Economic Coup Sukanya Bose

Since the mid-1990s, foreign direct investment into the banking industry in many emerging market economies has been growing at an unprecedented scale. The paper examines the consequences of this phenomenon on banking sector's efficiency, credit aggregates, and stability in the context of the Latin American economies. Banking_FDI (Download the full text in PDF format)  

The Macroeconomics of Poverty Reduction, Initial Findings of the UNDP Asia-Pacific Regional Programme Terry McKinley

This paper presents initial findings of nine country studies done for the UNDP Asia-Pacific Regional Programme on ‘Macroeconomics of Poverty Reduction’. These case studies have produced policy-oriented research on the impact of macroeconomic policies and adjustment policies on poverty in Bangladesh, Cambodia, China, Indonesia, Mongolia, Myanmar, Nepal, Sri Lanka and Vietnam. undp_asia_pacific (Download the full text in PDF format)

The World Economic Outlook, April 2003: A review of the IMF’s assessment on relation between economic growth and institutions Ranja Sengupta

The World Economic Outlook, brought out by the IMF in April 2003, provides detailed chapters on many issues – on ‘Why Bubbles Burst?’, ‘Unemployment and Labor Market Institutions: Why Reforms Pay Off?’,  and on ‘Growth and Institutions’. This review intends to focus on the last of these – firstly, because it is a crucial and potent question and has severe repercussions on the future of developing economies, and secondly, because it raises issues more interesting and perplexing than the IMF would have us believe. The overall conclusion of the chapter on ‘Growth and Institutions’ is that institutions play a major…