Number of results to display per page
Search Results
152. Japan Post: Retreat or Advance?
- Author:
- Gary Clyde Hufbauer and Julia Muir
- Publication Date:
- 01-2012
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Legislation to reform Japan Post is again gathering steam in Tokyo. The real question is whether the latest act in this long- running drama will represent true reform or in fact will camouflage an entrenchment of Japan Post's formidable monopoly powers. Antireform proposals being lined up for consideration in the Diet would indefinitely extend effective government control of Japan Post's financial arms (thereby reversing the Koizumi era reforms). On the other hand, reform forces in the Japanese government want new legislation to guarantee a level playing field in banking and insurance between Japan Post and private firms, whether domestic or foreign.
- Topic:
- Economics, Government, International Trade and Finance, and Natural Disasters
- Political Geography:
- Japan and Israel
153. The Coming Resolution of the European Crisis
- Author:
- C. Fred Bergsten and Jacob Funk Kirkegaard
- Publication Date:
- 01-2012
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Doom and gloom about the euro abounds. An increasing number of commentators and economists, including here at the Peterson Institute, have begun to question whether the common currency can survive.
- Topic:
- Economics, International Trade and Finance, Political Economy, Regional Cooperation, and Financial Crisis
- Political Geography:
- Europe
154. Interest Rate Shock and Sustainability of Italy's Sovereign Debt
- Author:
- William R. Cline
- Publication Date:
- 02-2012
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Contagion from Greece, together with domestic political uncertainty in Italy, caused interest rates on Italian sovereign debt to spike in the second half of 2011. As shown in figure 1, the risk spread above German bunds for 10-year Italian government bonds rose from 200 basis points in early July 2011, to a range of 300 to 400 basis points after the July 21 Greek package with its new emphasis on private sector involvement. There was a second surge to the 400 to 500 basis point range in November through January, following the October 27 Greek package that insisted on a 50 percent reduction in private sector claims.
- Topic:
- Debt, Economics, and Financial Crisis
- Political Geography:
- Europe, Germany, and Italy
155. Transportation and Communication Infrastructure in Latin America: Lessons from Asia
- Author:
- Barbara Kotschwar
- Publication Date:
- 04-2012
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- In Latin America, inadequate transportation infrastructure has been identified as an increasingly important impediment to the region's further integration in global trade and a significant factor preventing countries from properly taking advantage of the multitude of regional, plurilateral, and bilateral trade agreements signed in the past decade and a half. This paper examines transport and communications infrastructure initiatives in Latin American and Asian regional trade arrangements and finds several lessons Asia can teach Latin America.
- Topic:
- Development, Economics, International Trade and Finance, Communications, and Infrastructure
- Political Geography:
- Asia and Latin America
156. Global Imbalances and Foreign Asset Expansion by Developing Economy Central Banks
- Author:
- Joseph E. Gagnon
- Publication Date:
- 03-2012
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Over the past 10 years, central banks and governments throughout the developing world have accumulated foreign exchange reserves and other official assets at an unprecedented rate. This paper shows that this official asset accumulation has driven a substantial portion of the recent large global current account imbalances. These net official capital flows have become large relative to the size of the industrial economies, and they are a significant factor contributing to the weakness of the economic recovery in the major industrial economies.
- Topic:
- Development, Economics, Emerging Markets, Globalization, Markets, Monetary Policy, and Financial Crisis
157. Spillover Effects of Exchange Rates: A Study of the Renminbi
- Author:
- Arvind Subramanian, Aaditya Mattoo, and Prachi Mishra
- Publication Date:
- 03-2012
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- This paper estimates the impact of China's exchange rate changes on exports of competitor countries in third markets, known as the "spillover effect." Recent theory is used to develop an identification strategy in which competition between China and its developing country competitors in specific products and destinations plays a key role. The variation is used—afforded by disaggregated trade data—across exporters, importers, product, and time to estimate this spillover effect. The results show robust evidence of a statistically and quantitatively significant spillover effect. Estimates suggest that, on average, a 10 percent appreciation of China's real exchange rate boosts a developing country's exports of a typical 4-digit Harmonized System (HS) product category to third markets by about 1.5 to 2 percent. The magnitude of the spillover effect varies systematically with product characteristics as implied by theory.
- Topic:
- Development, Economics, and Markets
- Political Geography:
- China
158. Chinese Investment in Latin American Resources: The Good, the Bad, and the Ugly
- Author:
- Theodore H. Moran, Julia Muir, and Barbara Kotschwar
- Publication Date:
- 02-2012
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- China's need for vast amounts of minerals to sustain its high economic growth rate has led Chinese investors to acquire stakes in natural resource companies, extend loans to mining and petroleum investors, and write long-term procurement contracts for oil and minerals in Africa, Latin America, Australia, Canada, and other resource-rich regions. These efforts to procure raw materials might be exacerbating the problems of strong demand; "locking up" natural resource supplies, gaining preferential access to available output, and extending control over the world's extractive industries. But Chinese investment need not have a zero-sum effect if Chinese procurement arrangements expand, diversify, and make more competitive the global supplier system. Previous Peterson Institute research (see Moran 2010) and new research undertaken in this paper, show that the majority of Chinese investments and procurement arrangements serve to help diversify and make more competitive the portion of the world natural resource base located in Latin America. For a more comprehensive analysis, the authors conduct a structured comparison of four Peruvian mines with foreign ownership: two Organization for Economic Cooperation and Development-based, and two Chinese. They examine what conditions or policy measures are most effective in inducing Chinese investors to adopt international industry standards and best-practices, and which are not. They distill from this case study some lessons for other countries in Latin America, Africa, and elsewhere that intend to use Chinese investment to develop their extractive sectors: first, that financial markets bring accountability; second, that the host country regulatory environment makes a significant difference; and third, that foreign investment is a catalyst for change.
- Topic:
- Economics, International Trade and Finance, and Natural Resources
- Political Geography:
- China, Canada, Latin America, and Australia
159. Capital Controls: Myth and Reality-A Portfolio Balance Approach
- Author:
- Carmen M. Reinhart, Nicolas E. Magud, and Kenneth S. Rogoff
- Publication Date:
- 03-2011
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- The literature on capital controls has (at least) four very serious apples-to-oranges problems: (i) There is no unified theoretical framework to analyze the macroeconomic consequences of controls; (ii) there is significant heterogeneity across countries and time in the control measures implemented; (iii) there are multiple definitions of what constitutes a "success" and (iv) the empirical studies lack a common methodology-furthermore these are significantly "overweighted" by a couple of country cases (Chile and Malaysia). In this paper, we attempt to address some of these shortcomings by: being very explicit about what measures are construed as capital controls. Also, given that success is measured so differently across studies, we sought to "standardize" the results of over 30 empirical studies we summarize in this paper. The standardization was done by constructing two indices of capital controls: Capital Controls Effectiveness Index (CCE Index), and Weighted Capital Control Effectiveness Index (WCCE Index). The difference between them lies in that the WCCE controls for the differentiated degree of methodological rigor applied to draw conclusions in each of the considered papers. Inasmuch as possible, we bring to bear the experiences of less well known episodes than those of Chile and Malaysia. Then, using a portfolio balance approach we model the effects of imposing capital controls on short-term flows. We find that there should exist country-specific characteristics for capital controls to be effective. From this simple perspective, this rationalizes why some capital controls were effective and some were not. We also show that the equivalence in effects of price- vs. quantity-capital control are conditional on the level of short-term capital flows.
- Topic:
- Development, Economics, International Trade and Finance, and Markets
- Political Geography:
- Latin America and Southeast Asia
160. Capital Account Liberalization and the Role of the Renminbi
- Author:
- Nicholas R. Lardy and Patrick Douglass
- Publication Date:
- 02-2011
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Despite an erosion of consensus on its benefits, capital account convertibility remains a long-term goal of China. This paper identifies three major preconditions for convertibility in China: a strong domestic banking system, relatively developed domestic financial markets, and an equilibrium exchange rate. The authors examine each of these in turn and find that, in significant respects, China does not yet meet any of the conditions necessary for convertibility. They then evaluate China's progress to date on capital account liberalization, including recent efforts to promote renminbi internationalization and greater use of the renminbi in trade settlement. The paper concludes with an overview of remaining obstacles to convertibility and policy recommendations.
- Topic:
- Development, Economics, and Monetary Policy
- Political Geography:
- China