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9422. The 2015 Survey of Progress in International Economic Governance
- Author:
- Domenico Lombardi and Kelsey Shantz
- Publication Date:
- 11-2015
- Content Type:
- Policy Brief
- Institution:
- Centre for International Governance Innovation
- Abstract:
- The annual CIGI Survey of Progress in International Economic Governance assesses progress in five areas of international economic governance: macroeconomic and financial cooperation; cooperation on financial regulation; cooperation on development; cooperation on trade; and cooperation on climate change. In this year’s survey, 31 CIGI experts conclude that international economic arrangements continue to show a level of “status quo,” averaging a score of 50% across all five areas. The 2015 survey indicates a slight improvement to the result of last year’s survey, which suggested a minimal regression overall. The experts’ assessment of progress was most promising in the area of climate change cooperation, with an average score of 57%, whereas the least promising area was macroeconomic and financial cooperation, with a score of 44%, indicating minimal regression. The remaining three areas polled all fell within the “status quo” range, with trade at 46%, development at 48% and international cooperation on financial regulation at 53%. Interestingly, in the area of cooperation on development, CIGI’s experts provided a relatively mixed assessment. Responses varied based on experts’ perception of the effectiveness of current rhetoric, from 70% (indicating some progress) to 10% (suggesting major regression). Compared to last year, climate change governance has made the greatest improvement, but the remaining three areas (with the exception of development, which was not included in the 2014 survey) have all, on average, regressed further or remained stagnant. This trend is cause for concern.
- Topic:
- Climate Change, Development, Economics, International Cooperation, and International Trade and Finance
- Political Geography:
- Global Focus
9423. An Assessment of the Korea-China Free Trade Agreement
- Author:
- Jeffrey Schott, Eujiin Jung, and Cathleen Cimino-Isaacs
- Publication Date:
- 12-2015
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Of all the free trade agreements (FTAs) concluded by Korea with its major trading partners since the turn of the century, the Korea-China FTA may be the largest in trade terms. It is, however, far from the best in terms of the depth of liberalization and the scope of obligations on trade and investment policies. Korea and China agreed to liberalize a large share of bilateral trade within 20 years, but both sides incorporated extensive exceptions to basic tariff reforms and deferred important market access negotiations on services and investment for several years. Political interests trumped economic objectives, and the negotiated outcome cut too many corners to achieve such a comprehensive result. The limited outcome in the Korea-China talks has two clear implications for economic integration among the northeast Asian countries. First, prospects for the ongoing China-Japan-Korea talks will be limited and unlikely to exceed the Korea-China outcome. Second, Korea and Japan need to strengthen their bilateral leg of the northeast Asian trilateral and the best way is by negotiating a deal in the context of the Trans-Pacific Partnership.
- Topic:
- Economics, International Trade and Finance, Politics, and Bilateral Relations
- Political Geography:
- United States, China, Asia, and Korea
9424. Toward a European Migration and Mobility Union
- Author:
- Jacob Funk Kirkegaard
- Publication Date:
- 12-2015
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- After surviving its worst economic downturn since the Great Depression and the near collapse of its common currency, Europe is now engulfed by hundreds of thousands of desperate migrants and refugees from the Middle East and Africa. It needs new and permanent migration institutions and resources not only to accommodate the influx of refugees but also to set up a new border control system throughout the region. These demands pose a challenge for European policymaking as serious as the euro crisis of the last five years. Kirkegaard proposes a migration and mobility union, to be implemented gradually, with the goal of comprehensively reforming European migration policy.
- Topic:
- Economics, Migration, Politics, and Refugee Issues
- Political Geography:
- Europe
9425. Pitching a Level Playing Field: Women and Leadership in Sports
- Author:
- Barbara Kotschwar and Tyler Moran
- Publication Date:
- 12-2015
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- While women's presence in the leadership ranks of international sporting bodies has increased over the past decade, women continue to be underrepresented relative to their involvement in sports. Seeing qualified women in sports leadership positions can serve as a strong motivator for female athletes, which is important given the strong link between girls' participation in sports and positive outcomes in education, health, and positioning in the workforce. The important multiplier effects that sports can have for girls and women, and the important effects that positive female outcomes can have for economic growth, makes promoting gender equality in sports leadership a wise societal investment.
- Topic:
- Education, Gender Issues, Human Welfare, and Social Movement
- Political Geography:
- Global Focus
9426. World on the Move: The Changing Global Income Distribution and Its Implications for Consumption Patterns and Public Policies
- Author:
- Tomas Hellebrandt and Paolo Mauro
- Publication Date:
- 12-2015
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- In the next two decades, hundreds of millions of people in emerging economies are projected to reach income levels at which they will be able to afford cars and air travel. As purchasing power increases worldwide, people will spend proportionately less on food and beverages and more on transportation. Higher spending on transportation, especially in China, India, and Sub-Saharan Africa, will increase pressures on the infrastructure in these economies and aggravate global climate change. Governments will need to respond to these challenges in a fiscally sustainable and environmentally responsible way.
- Topic:
- Emerging Markets, International Trade and Finance, Politics, and Economies
- Political Geography:
- Global Focus
9427. Estimates of Fundamental Equilibrium Exchange Rates, November 2015
- Author:
- William R. Cline
- Publication Date:
- 11-2015
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- The latest semiannual fundamental equilibrium exchange rate (FEER) estimates find that the US dollar is now overvalued by about 10 percent, comparable to levels in 2008 through early 2010 and again in 2011. Unlike then, the current strong dollar does not reflect a weak renminbi kept undervalued by major exchange rate intervention by China. Instead, China's current account surplus has fallen sharply relative to GDP, and its recent intervention has been to prevent excessive depreciation rather than to prevent appreciation. Additionally, declines in the real effective exchange rates (REERs) for major emerging-market economies and resource-based advanced economies, driven by falling commodity prices in recent months, have strengthened the dollar. Recent increases in the REERs for the euro area and Japan have removed their modest undervaluation identified in the last FEERs estimates in May, and the Chinese renminbi remains consistent with its FEER. The dollar's rise by nearly 15 percent in real effective terms over the past two years could impose a drag of nearly one-half percent annually on US demand growth over the next five years. As the Federal Reserve moves to normalize US monetary policy, it may need to consider a gentler rise in interest rates than it might otherwise have pursued, both to temper possible further strengthening of the dollar in response to higher interest rates and to help offset the demand compression from falling net export
- Topic:
- Economics, International Trade and Finance, Monetary Policy, and GDP
- Political Geography:
- United States and China
9428. Stability Bonds for the Euro Area
- Author:
- Angel Ubide
- Publication Date:
- 12-2015
- Content Type:
- Policy Brief
- Institution:
- Peterson Institute for International Economics
- Abstract:
- The rules and buffers created in the last few years to enable the euro area to withstand another sudden stop of credit and market-driven panic in one or more of its member states are welcome steps, but they are widely recognized as inadequate. Ubide proposes creating a system of stability bonds in the euro area, to be issued by a new European Debt Agency, to partially finance the debt of euro area countries—up to 25 percent of GDP. These stability bonds should be initially backed by tax revenues transferred from national treasuries, but ultimately by the creation of euro area–wide tax revenues, and used to fund the operations of national governments. They could also be used for euro area–wide fiscal stimulus, to complement the fiscal policies of member states. Such bonds would strengthen the euro area economic infrastructure, creating incentives for countries to reduce their deficits but not forcing them to do so when such actions would drive their economies further into a downturn. The bonds would permit the euro area to adopt a more flexible or expansionary fiscal policy during recessions.
- Topic:
- Economics, International Trade and Finance, Monetary Policy, and GDP
- Political Geography:
- Europe
9429. Inflation and Activity: Two Explorations and Their Monetary Policy Implications
- Author:
- Olivier Blanchard, Eugenio Cerutti, and Lawrence H. Summers
- Publication Date:
- 11-2015
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Blanchard, Cerutti, and Summers explore two issues triggered by the global financial crisis. First, in most advanced countries, output remains far below the prerecession trend, suggesting hysteresis. The authors look at 122 recessions over the past 50 years in 23 countries and find that a high proportion of them have been followed by lower output or even lower growth. Second, while inflation has decreased, it has decreased less than anticipated, suggesting a breakdown of the relation between inflation and activity. The authors estimate a Phillips curve relation over the past 50 years for 20 countries and find that the effect of unemployment on inflation, for given expected inflation, decreased until the early 1990s but has remained roughly stable since then. The paper concludes with implications for monetary policy.
- Topic:
- Economics, Labor Issues, Monetary Policy, Financial Crisis, and GDP
- Political Geography:
- Global Focus
9430. Can Foreign Exchange Intervention Stem Exchange Rate Pressures from Global Capital Flow Shocks?
- Author:
- Olivier Blanchard, Gustavo Adler, and Irineu de Carvalho Filho
- Publication Date:
- 11-2015
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- Many emerging-market economies have relied on foreign exchange intervention (FXI) in response to gross capital inflows. The authors study whether FXI has been an effective tool to dampen the effects of these inflows on the exchange rate. To deal with endogeneity issues, they look at the response of different countries to plausibly exogenous gross inflows and explore the cross-country variation of FXI and exchange rate responses. Consistent with the portfolio balance channel, they find that larger FXI leads to less exchange rate appreciation in response to gross inflows.
- Topic:
- Economics, Emerging Markets, Foreign Exchange, and Monetary Policy
- Political Geography:
- Global Focus