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…

Society, Economic Policies, and the Financial Sector Y.V. Reddy

This is the Per Jacobsson Foundation Lecture 2012 delivered by the author at Basel, Switzerland. It is argued that the biggest challenge for the future of finance lies in designing governance practices that avoid the dangers of comprehensive regulatory capture. Approaches to regulation of the financial sector should continue to be national since the global environment is not necessarily favourable. In this regard, consideration of regulation, competition and ownership in the financial sector in an integrated manner, enhanced monitoring of financial market activities and the use of fiscal tools to supplement regulation could be helpful. Financial_Sector (Download the full text…

Global Rules and Markets: Constraints over policy autonomy in developing countries Yilmaz Akyüz

The Recent years of rapid opening up and integration of developing countries into the world economy have placed a growing demand on policy makers and called for greater flexibility in the policy-making process but have simultaneously made many of the traditional instruments of development and macroeconomic policy ineffective or simply unavailable because of proliferation of international rules, obligations and practices. Consequently questions have been raised about whether such constraints over national economic policy are compatible with development, including the capacity to foster conditions for steady quality employment growth. This is the question this paper explores in detail. global_rules (Download the…

Macroeconomic Policy, Inequality and Poverty Reduction in India and China C.P. Chandrasekhar & Jayati Ghosh

[Working Paper No. 05/2006]  The two "success" stories of globalisation, India and China, characterised by the high and sustained rates of growth of aggregate and per capita national income, the absence of major financial crises and substantial reduction in income poverty, along with their significant impact on global inequalities make a good case for a comparison of the nature of macroeconomic policies in these two countries, and the extent to which these have been "pro-poor". This paper attempts such an examination, assessing the growth performance and its impact on poverty and inequality in these two countries, and also specifically addressing…

Macroeconomics of Twin-Targeting in Turkey: A general equilibrium analysis Ebru Voyvoda & Erinc Yeldan

The post-1998 Turkish macroeconomic adjustments reveal speculative-led growth patterns with limited employment creation and a widening foreign deficit together with increased foreign indebtedness. The paper provides an overview of the post-1998 Turkish economy and constructs a macroeconomic general equilibrium model to illustrate the prevalent fragilities in the financial and commodity markets and also study viable policy alternatives to the current Programme over the medium run, spanning 2006-2010. twin_target_turkey (Download the full text in PDF format)

Financial Liberalization in India: An assessment of its nature and outcomes C.P. Chandrasekhar and Parthapratim Pal

Providing a descriptive analysis of the Indian experience with the process of financial liberalisation, this paper argues that it has led to increased financial fragility, currently epitomised by the irrational boom in the Indian stock market; a deflationary macroeconomic stance with adverse effects on public capital formation, employment generation and poverty reduction; and finally, a credit squeeze affecting the real economy. financial_liberalization (Download the full text in PDF format)

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)

Japanese Economic Recovery and the Macroeconomic Policy Mix Sukanya Bose

Japanese macroeconomic policy during the prolonged depression of the 1990s has been the reverse of what Keynes had recommended as the anti-deflationary strategy. The paper explores the three main pillars of macroeconomic policy for the Japanese economy in the recent years: financial policy, fiscal policy and monetary policy. japanese_recovery (Download the full text in PDF format)

International Workshop on ‘Liberalisation, Macroeconomic Policy and Development options in Asia’ OrganiSed by IDEAs in collaboration with the MAIDS at Bangkok, Thailand, 25-28 September 2004.

In the month of September, 2004, a joint workshop was organized by IDEAs in collaboration with the MAIDS (Masters of Arts Programme in International Development Studies) programme, which is run by the Faculty of Political Science at Chulanlongkorn University, Thailand. The workshop, entitled 'Liberalisation, Macroeconomic Policy and Development Options in Asia', was held in Bangkok from the 25th to 28th of September, 2004. The second leg of the workshop was held in Manila in collaboration with the Philippines based organization, Action for Economic Reform, from the 24th of September to the 1st of October, 2004. The purpose of the workshops was to bring together a group of economists…

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