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9451. The Future of Worldwide Income Distribution

Author:
Tomas Hellebrandt and Paolo Mauro
Publication Date:
04-2015
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
Over the next two decades the structure of world population and income will undergo profound changes. Global income inequality is projected to decline further in 2035, largely owing to rapid economic growth in the emerging-market economies. The potential pool of consumers worldwide will expand significantly, with the largest net gains in the developing and emerging-market economies. The number of people earning between US$1,144 and US$3,252 per year in 2013 prices in purchasing power parity terms will increase by around 500 million, with the largest gains in Sub-Saharan Africa and India; those earning between US$3,252 and US$8,874 per year in 2013 prices will increase by almost 1 billion, with the largest gains in India and Sub-Saharan Africa; and those earning more than US$8,874 per year will increase by 1.2 billion, with the largest gains in China and the advanced economies.
Topic:
Economics, Emerging Markets, Globalization, and Labor Issues
Political Geography:
Africa and Asia

9452. Financing Productivity- and Innovation-Led Growth in Developing Asia: International Lessons and Policy Issues

Author:
Ajai Chopra
Publication Date:
03-2015
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
Growth in developing Asia will need to rely more on improvements in productivity growth and less on capital deepening. Although there is no single reform path to spur productivity growth, financial system deepening is central to a more efficient allocation of capital across sectors and can facilitate innovation and technology transfer. But malfunctioning financial systems can also result in the misallocation of resources, making it important that policymakers focus less on increasing the size of the financial sector and more on improving its intermediation function. Chopra discusses the steps to mobilize Asia's ample private savings for long-term financing, especially to tackle the region's infrastructure deficit and improve access to financing for small and medium enterprises, which can help raise productivity. As many countries in Asia shift from a development model based on technology absorption to one that promotes innovation, specialized finance and investors can play a critical role in allowing innovative firms to conduct research, adopt technologies necessary for inventions, and ultimately commercialize innovations.
Topic:
Economics, International Trade and Finance, Markets, and Science and Technology
Political Geography:
Asia

9453. The Financial Sector and Growth in Emerging Asian Economies

Author:
William R. Cline
Publication Date:
03-2015
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
The financial sectors in Asian emerging-market economies are now relatively unlikely to provoke new financial crises, either because of reforms after the East Asian financial crisis in the later 1990s or because of the dominance of state-owned banks not subject to bank runs. Financial intermediation is surprisingly high and is consistent with higher rates of saving and investment and hence growth in the main economies of the region (as compared to, say, counterparts in Latin America). Nonetheless, there are sharply diverging patterns (e.g., high foreign ownership of banks in Korea versus minimal presence in China) and differing national structures (bank dominated, portfolio oriented, and diversified) within Asia. Cline recommends establishing long-term plans to improve efficiency in state-owned banks or reduce their dominance and pursuing bank capitalization targets at least as ambitious as those of Basel III. Cline also calls for ensuring adequate regulation of growing nonbank intermediaries, reversing a recent trend toward national barriers to foreign banks in some economies, and improving the legal security of bank regulators.
Topic:
Economics, Emerging Markets, Financial Crisis, and Reform
Political Geography:
Asia

9454. Maintaining Financial Stability in the People's Republic of China during Financial Liberalization

Author:
Nicholas Borst and Nicolas R. Lardy
Publication Date:
08-2015
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
China's banking system is now the largest in the world, and its capital markets are rapidly approaching the size of those in the advanced economies. Borst and Lardy trace the evolution of China's financial system away from a traditional bank-dominated and state-directed financial system toward a more complex, market-based system. They analyze and outline the optimal sequence of financial reforms needed to manage the new risks accompanying this evolution.
Topic:
Economics, Markets, Financial Crisis, and Reform
Political Geography:
China

9455. Burma Before the Elections

Author:
Zoltan Barany
Publication Date:
10-2015
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Burma’s upcoming elections will be a test of how much the country’s political scene has changed since the generals’ tentative liberalisation programme began five years ago. The National League for Democracy, led by democracy icon Aung San Suu Kyi, is likely to win big. Still, it may not get the two-thirds of the parliamentary seats open for competition that it needs to form a government. If it does not, it ought to blame itself, for the NLD has been unwilling to enter into coalitions either with much-respected civic organisations or with the increasingly vocal and well-organised ethnic parties. At the same time, the military-backed Union Solidarity and Development Party has led a smart campaign just short of breaking the electoral laws. Both the USDP and ethnic parties might do better than expected and cost the NLD – dominated and controlled by Suu Kyi – a crucial opportunity to advance democracy.
Topic:
Democratization, Ethnic Conflict, Political Economy, Authoritarianism, and Reform
Political Geography:
Southeast Asia
Publication Identifier:
978-88-98650-63-7
Publication Identifier Type:
DOI

9456. The Outlook for Algeria

Author:
Joffé George
Publication Date:
10-2015
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Algeria today faces a triple crisis. The collapse in global oil prices during 2014 and 2015 has meant that its economic future is potentially extremely sombre. In political terms, the regime faces a complex and uncertain transition as the Bouteflika era comes to an end. Moreover, Algeria’s security environment is threatening, given the chaos in Libya, the emergence of extremism in Tunisia and the ongoing violence in northern Mali because of the extremist groups located there. This situation is further complicated by the persistence of “residual terrorism,” as the government terms it, inside Algeria itself and the chronic crisis with Morocco over the latter’s annexation of the Western Sahara in 1975. This paper analyses each of these factors in turn before seeking to outline short- to medium-term scenarios for the future.
Topic:
Security, Economics, Islam, Oil, and Terrorism
Political Geography:
North Africa
Publication Identifier:
978-88-98650-62-0
Publication Identifier Type:
DOI

9457. China's New Silk Road Initiative

Author:
Zhao Minghao
Publication Date:
10-2015
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The European Council has mandated the High Representative of the Union for Foreign Affairs and Security Policy, Federica Mogherini, to draft a Global Strategy by June 2016. Given Europe’s status as a global power, such a strategy must respond to Europe’s own challenges as well as to the new grand strategies of other major players in world politics, like China. To better understand the central tenets of the Chinese leadership’s strategic thinking, two keywords are most important – the “Four Comprehensives” and the “One Belt and One Road” (OBOR). As an initiative mainly focusing on promoting Eurasian integration and reshaping Chinese geo-economic advantages, the OBOR is highly consequential to China’s interactions with Europe and the rest of the world at large in the decades to come. How to take advantage of the OBOR, create new EU-China synergies, and tackle relevant challenges are questions the EU leaders should be attentive to.
Topic:
Economics, International Cooperation, International Trade and Finance, Markets, and Bilateral Relations
Political Geography:
Europe and Asia
Publication Identifier:
978-88-98650-61-3
Publication Identifier Type:
DOI

9458. The Metamorphosis of Religion: North Africa in the Modern Era

Author:
Mohammad Haddad
Publication Date:
09-2015
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Since the nineteenth century, North Africa’s religious life has witnessed a slow and uncertain metamorphosis. It is still unable to settle into a constant and sustainable model. The traditional order could not resist the emergence of the nation-state, modern education and new forms of social organisation. However, religion has remained on the margins of these developments. Although used in the anticolonial struggle, religion was then abandoned during the formation of the postcolonial state. Yet the difficulties faced by governments since the 1970s have entrusted religion with a predominantly opposition function, which is negative and sometimes violent. This paper argues that only neo-reformism can give a positive spin to religion’s role in politics and can serve as the basis for a new religious order.
Topic:
Islam, Post Colonialism, Non State Actors, and Reform
Political Geography:
North Africa
Publication Identifier:
978-88-98650-60-6
Publication Identifier Type:
DOI

9459. Overhauling EU Policy in the Mediterranean. Towards More Inclusive, Responsive and Flexible Policies

Author:
Daniela Huber and Maria Cristina Paciello
Publication Date:
09-2015
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
As the EU is reviewing its European Neighbourhood Policy, this paper calls for an entirely new approach that would give the EU a stake in the region by responding more effectively to key needs on both sides of the Mediterranean. It first outlines three strategic policy options for the EU – defensive, power-projecting and reflexive approaches – and analyses EU policies accordingly. After observing that EU policies in the Mediterranean since the Arab uprisings have oscillated between a defensive and a power-projecting approach, this paper discusses how EU policies could become more inclusive of key actors, more responsive to key challenges and more flexible on both the multilateral and the bilateral level.
Topic:
Foreign Policy, Defense Policy, Regional Cooperation, Power Politics, and European Union
Political Geography:
Europe
Publication Identifier:
978-88-98650-59-0
Publication Identifier Type:
DOI

9460. The Migration and Asylum Crisis as a Transformative Shock for Europe. Brief Thoughts on the Eve of the Next Summit

Author:
Pastore Ferruccio
Publication Date:
09-2015
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Never before was the lack of a single European government, or at least of a strong and effective European governance, as acutely felt as in these days. With wars and failed states in the neighbourhood, and an unstoppable exodus crossing Europe, the continent appears at once more interdependent and more fragmented than ever. A coherent model of governance, competent and cohesive, but above all empowered by a full democratic investiture, would be needed everyday, to cope with daily emergencies while painstakingly devising and developing a long-term strategy where such emergency responses would be framed. Instead, in spite of the remarkable efforts of creative leadership made by the Commission, we are “governed” (but the term sounds like a gross overstatement) by subsequent extraordinary summits, each summoned to remedy the failures of the previous one. What can thus be expected and what should be asked, in such dire circumstances, to the next of these ad hoc European Council meeting, scheduled on Wednesday 23 September?
Topic:
Migration, War, Fragile/Failed State, Governance, and European Union
Political Geography:
Europe
Publication Identifier:
978-88-98650-58-3
Publication Identifier Type:
DOI