Search

Begin New Search Topic Economics Political Geography Global Focus

241. Positive Peace Report 2020: Analysing the factors that sustain peace

Publication Date:
01-2020
Content Type:
Special Report
Institution:
Institute for Economics & Peace (IEP)
Abstract:
Peace is the prerequisite for the survival of humanity in the 21st century. Without peace, it will not be possible to achieve the levels of trust, cooperation and inclusiveness necessary to solve these challenges, let alone empower international institutions and organisations necessary to address them. In the past, peace may have been the domain of the altruistic but in the current century it is clearly in everyone’s self-interest. Without an understanding of the factors that create and sustain peaceful societies, it will not be possible to develop the programmes, create the policies or understand the resources required to build peaceful and resilient societies. Positive Peace provides a framework to understand and address the many complex challenges the world faces. Positive Peace is transformational in that it is a cross-cutting facilitator of progress, making it easier for businesses to sell, entrepreneurs and scientists to innovate, individuals to produce and governments to effectively regulate. In addition to the absence of violence, Positive Peace is also associated with many other social characteristics that are considered desirable, including stronger economic outcomes, higher resilience, better measures of wellbeing, higher levels of inclusiveness and more sustainable environmental performance.
Topic:
Economics, International Cooperation, Peace Studies, Peacekeeping, and Peace
Political Geography:
Global Focus

242. Modeling Myths: On the Need for Dynamic Realism in DICE and other Equilibrium Models of Global Climate Mitigation

Author:
Claudia Wieners and Michael Grubb
Publication Date:
01-2020
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
We analyze and critique how optimizing Integrated Assessment Models, and specifically the widely-used DICE model, represent abatement costs. Many such models assume temporal independence –abatement costs in one period are not affected by prior abatement. We contrast this with three dimensions of dynamic realism in emitting systems: inertia, induced innovation, and path dependence. We extend the DICE model with a stylized representation of such dynamic factors. By adding a transitional cost component, we characterize the resulting system in terms of its capacity to adapt in path-dependent ways, and the transitional costs of accelerating abatement. We formalize a resulting metric of the pliability of the system, and the characteristic timescales of adjustment. With the resulting DICE-PACE model, we show that in a system with high pliability, the optimal strategy involves much higher initial investment in abatement, sustained at roughly constant levels for some decades, which generates an approximately linear abatement path and emissions declining steadily to zero. This contrasts sharply with the traditional formulation. Characteristic transition timescales of 20-40 years result in an optimum path which stabilizes global temperatures around a degree below the traditional DICE behavior; with otherwise modest assumptions, a pliable system can generate optimal scenarios within the goals of the Paris Agreement, with far lower long run combined costs of abatement and climate damages. We conclude that representing dynamic realism in such models is as important as – and far more empirically tractable than – continued debate about the monetization of climate damages and ‘social cost of carbon’.
Topic:
Climate Change, Economics, Paris Agreement, and Models
Political Geography:
Global Focus

243. Who’s Responsible Here? Establishing Legal Responsibility in the Fissured Workplace

Author:
Tanya Goldman and David Weil
Publication Date:
02-2020
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
The nature of work is changing, with workers enduring increasingly precarious working conditions without any safety net. In response, this Article proposes a new “Concentric Circle framework” which would improve workers’ access to civil, labor, and employment rights. Many businesses, including app-based platforms, have restructured toward “fissured workplace” business models. They treat workers like employees (specifying behaviors and closely monitoring outcomes) but they classify workers as independent contractors (engaging them at an arms-length and cutting them off from rights and benefits tied to employment). These arrangements confound legal classifications of “employment” and expose deficiencies with existing workplace protections, which are based on “employment relationships.” As a result, a growing number of workers lack both bargaining power and critical workpalce rights and benefits. We propose a Concentric Circle framework to better govern workers’ rights in the modern era. At the core, we maintain that certain rights and protections should not be tethered to an employment relationship, but to work itself. Thus, the right to be compensated for work and paid a minimum wage; freedom from discrimination and retaliation; access to a safe working environment, and the right to associate and engage in concerted activity should belong to all workers, not just employees. Second, as a middle circle, we argue for a rebuttable presumption of employment to address those rights that remain exclusive to employees (and not independent contractors), and we propose an updated legal test of employment. Finally, at the outer ring of the framework, we suggest policies that could enhance workers’ access to benefits that promote worker mobility and social welfare. Other scholarship has focused exclusively on either independent contractors or employees, or it has proposed a new category of worker altogether. We contend that this comprehensive framework better assigns rights, responsibilities, and protections in the modern workplace than do current legal doctrines or alternative proposals.
Topic:
Economics, Labor Issues, Law, Legal Theory, Civil Rights, Legal Sector, and Workforce
Political Geography:
Global Focus

244. Firm-Level Exposure to Epidemic Diseases: Covid-19, SARS, and H1N1

Author:
Tarek A. Hassan, Stephan Hollander, Laurence van Lent, and Ahmed Tahoun
Publication Date:
04-2020
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
Using tools described in our earlier work (Hassan et al., 2019, 2020), we develop text- based measures of the costs, benefits, and risks listed firms in the US and over 80 other countries associate with the spread of Covid-19 and other epidemic diseases. We identify which firms expect to gain or lose from an epidemic disease and which are most affected by the associated uncertainty as a disease spreads in a region or around the world. As Covid-19 spreads globally in the first quarter of 2020, we find that firms’ primary concerns relate to the collapse of demand, increased uncertainty, and disruption in supply chains. Other important concerns relate to capacity reductions, closures, and employee welfare. By contrast, financing concerns are mentioned relatively rarely. We also identify some firms that foresee opportunities in new or disrupted markets due to the spread of the disease. Finally, we find some evidence that firms that have experience with SARS or H1N1 have more positive expectations about their ability to deal with the coronavirus outbreak.
Topic:
Economics, Infectious Diseases, Global Markets, Finance, Pandemic, and COVID-19
Political Geography:
Global Focus

245. Eternal return on capital: Nihilistic repetition in the asset economy

Author:
Amin Samman
Publication Date:
05-2020
Content Type:
Working Paper
Institution:
City Political Economy Research Centre (CITYPERC), University of London
Abstract:
What can the idea of eternal return tell us about contemporary financial society? In this essay I follow Nietzsche by deploying it as an existential provocation, linking the prospect of endless recurrence to the daily routines of the asset economy. This entails a departure from simple notions of cyclical time, typically associated with political economy and the study of economic history, in favor of a more complex view that sees recurrence and return as figures that organize and reflect the experience of life under the sign of finance. In particular, I argue that the reordering of class around the axis of asset ownership has produced two seemingly distinct structures of feeling— one based on the thrill of endless turnover and return on capital, the other on the drudgery of recurring payment schedules and debt rollovers. Though on the surface at odds with each other, both are anchored in a deeper libidinal economy associated with the asset form and ultimately nihilistic in character. The asset economy should therefore be seen as producing a very peculiar form of eternity based on the abolition of time through repetition. I conclude by foregrounding questions of culture and imagination, exploring these in connection with contemporary forms of on-demand television and the possibility of a time beyond the bad eternity of the asset economy.
Topic:
Economics, History, Capitalism, Finance, Digital Economy, Temporality, Assets, Nihilism, and Historical Imagination
Political Geography:
Global Focus

246. The Impact of Corona on the World Economy

Author:
Emmanuel Navon
Publication Date:
03-2020
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
The spread of so lethal a virus on so wide a scale in so globalized an economy is unprecedented. Its impact is expected to be more ruinous than that of the 2008-2009 financial crisis.
Topic:
Economics, Public Health, Pandemic, and COVID-19
Political Geography:
Global Focus

247. Refugees’ Integration into the Austrian Labour Market: Dynamics of Occupational Mobility and Job-Skills Mismatch

Author:
Mahdi Ghodsi and Robert Stehrer
Publication Date:
10-2020
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
Eight multilateral rounds of negotiations under the General Agreement on Tariffs and Trade (GATT) and international agreements under the World Trade Organisation (WTO) have contributed significantly to the reduction of tariffs among WTO members. However, over the years legitimate reasons for the imposition of non-tariff measures (NTMs) within regulations have triggered their extensive use. Among these measures, technical barriers to trade (TBTs) and sanitary and phytosanitary (SPS) measures allow countries to impose restrictions on the import of low-quality products suspected of harming domestic consumers’ health, plant life or the environment. Such trade policy instruments may lead to higher standards in the import market, in addition to improving market efficiency through information requirements such as mandatory labelling. This paper analyses two types of regulative and standard-like NTMs – TBTs and SPS measures – and the quality improvement of traded products that is driven by their imposition, which might be a general underlying motive for the adoption of such regulations. Based on a model framework involving both the supply and the demand side of trade and using four types of measures of these NTMs, this paper assesses the impact of TBTs and SPS measures on the quality of traded products. A dummy variable measuring the existence of these NTMs and a count variable indicating their stringency are used in the analysis. Moreover, two other variables indicate flows of NTMs imposed in each year and stocks of these NTMs accumulated over years. The results indicate that TBTs and SPS measures do indeed imply a higher quality of traded products, which is also consistent with the model when NTMs enter as a specific trade cost. Stringent TBTs with more regulations imposed in each year (i.e. flows of count TBTs) have the largest impact on the quality of traded products. However, for SPS measures only the existence of a regulation (i.e. the dummy variable on flows of SPS measures) on a traded product has the strongest impact on its quality.
Topic:
Economics, International Political Economy, International Trade and Finance, WTO, Non-Tariff Measures, and GATT
Political Geography:
Europe and Global Focus

248. 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

249. 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

250. 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