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Working Paper No.799
06 May 2014
Νομισματική μηχανική
AbstractΗ παρούσα εργασία αναπτύσσει το πλαίσιο της ανάλυσης των νομισματικών συστημάτων που διαμορφώθηκε από οικονομολόγους όπως ο Macleod, ο Keynes, ο Innes και ο Knapp. Το συγκεκριμένο πλαίσιο δεν εστιάζει στις λειτουργίες που επιτελούνται από ένα αντικείμενο, αλλά στα χρηματοοικονομικά χαρακτηριστικά του. Οτιδήποτε έχει εκδοθεί από οποιονδήποτε μπορεί να αποτελέσει ένα νομισματικό μέσο και κάθε είδους υλικό μπορεί να χρησιμοποιηθεί για να φτιαχτεί ένα νομισματικό μέσο, καθώς αυτά αποτελούν ασήμαντους παράγοντες όσον αφορά τη λειτουργία ενός νομισματικού μέσου. Αυτό που έχει σημασία είναι η ύπαρξη ειδικών χρηματοοικονομικών χαρακτηριστικών. Μέσα σε ένα κατάλληλο οικονομικό περιβάλλον, αυτά τα χαρακτηριστικά οδηγούν σε μια σταθερή ονομαστική αξία. Αυτό το πλαίσιο ανάλυσης ωθεί τον ερευνητή να μελετήσει τον τρόπο με τον οποίον μεταβάλλεται η εύλογη αξία ενός νομισματικού μέσου και τον τρόπο με τον οποίον η μεταβολή διαφέρει από τις μεταβολές στην αξία της λογιστικής μονάδας. Επίσης, παρέχει έναν οδικό χάρτη για την κατανόηση της νομισματικής ιστορίας και τους λόγους για τους οποίους διακρατούνται τα νομισματικά μέσα.
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Working Paper No.799
06 May 2014
Monetary Mechanics
AbstractThis paper develops the framework of analysis of monetary systems put together by authors such as Macleod, Keynes, Innes, and Knapp. This framework does not focus on the functions performed by an object but rather on its financial characteristics. Anything issued by anybody can be a monetary instrument and any type of material can be used to make a monetary instrument, as these are unimportant determinants of what a monetary instrument is. What matters is the existence of specific financial characteristics. These characteristics lead to a stable nominal value (parity) in the proper financial environment. This framework of analysis leads the researcher to study how the fair value of a monetary instrument changes and how that change differs from changes in the value of the unit of account. It also provides a road map to understanding monetary history and why monetary instruments are held.
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Public Policy Brief No.132
05 May 2014
How Poor Is Turkey? And What Can Be Done About It?
AbstractGauging the severity of poverty in a given country requires a reasonably comprehensive measurement of whether individuals and households are surpassing some basic threshold of material well-being. This would seem to be an obvious point, and yet, in most cases, our official poverty metrics fail that test, often due to a crucial omission. In this policy brief, Senior Scholar Ajit Zacharias, Research Scholar Thomas Masterson, and Research Associate Emel Memiş present an alternative measure of poverty for Turkey and lay out the policy lessons that follow. Their research reveals that the number of people living in poverty and the severity of their deprivation have been significantly underestimated. This report is part of an ongoing Levy Institute project on time poverty (the Levy Institute Measure of Time and Income Poverty), which has produced research on Latin America, Korea, and now Turkey, with the aim of extending this approach to other countries.
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Public Policy Brief No.132
05 May 2014
Πόσο φτωχή είναι η Τουρκία και τι μπορεί να γίνει
AbstractH μέτρηση της σοβαρότητας της φτώχειας σε μια δεδομένη χώρα πρέπει να εξετάζει με έναν αρκετά περιεκτικό τρόπο το κατά πόσο τα άτομα και τα νοικοκυριά ξεπερνούν κάποιο βασικό όριο όσον αφορά την υλική ευημερία. Ωστόσο, αν και αυτό το σημείο πιθανώς να φαίνεται προφανές, στις περισσότερες περιπτώσεις οι επίσημες μετρήσεις της φτώχειας αποτυγχάνουν αυτή τη δοκιμασία, πολύ συχνά λόγω μια πολύ σημαντικής παράλειψης. Σε αυτό το κείμενο πολιτικής, ο ανώτατος μελετητής Ajit Zacharias και οι ερευνητές Thomas Masterson και Emel Memiş παρουσιάζουν μια εναλλακτική μέτρηση της φτώχειας για την Τουρκία, καθώς και τα διδάγματα πολιτικής που ακολουθούν. Η έρευνά τους αποκαλύπτει ότι ο αριθμός των ανθρώπων που ζουν σε συνθήκες φτώχειας, καθώς και το βάθος και η σοβαρότητα της στέρησής τους έχει υποτιμηθεί σημαντικά. Η έκθεση αυτή αποτελεί μέρος ενός μόνιμου πρότζεκτ του Levy Institute για τη φτώχεια χρόνου, το οποίο έχει παράγει ερευνητικά αποτελέσματα για χώρες της Λατινικής Αμερικής, την Κορέα, και τώρα τη Τουρκία, με στόχο την επέκταση αυτής της προσέγγισης και σε άλλες χώρες.
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Research Project Report
01 May 2014
Time Deficits and Poverty
AbstractOfficial poverty lines in Turkey and other countries often ignore the fact that unpaid household production activities that contribute to the fulfillment of material needs and wants are essential for the household to reproduce itself as a unit. This omission has consequences. Taking household production for granted when measuring poverty yields an unacceptably incomplete picture, and therefore estimates based on such an omission provide inadequate guidance to policymakers.
Standard measurements of poverty assume that all households and individuals have enough time to adequately attend to the needs of household members—including, for example, children. These tasks are absolutely necessary for attaining a minimum standard of living. But this assumption is false. For numerous reasons, some households may not have sufficient time, and they thus experience what are referred to as “time deficits.” If a household officially classified as nonpoor has a time deficit and cannot afford to cover it by buying market substitutes (e.g., hire a care provider), that household will encounter hardships not reflected in the official poverty measure. To get a more accurate calculus of poverty, we have developed the Levy Institute Measure of Time and Consumption Poverty (LIMTCP), a two-dimensional measure that takes into account both the necessary consumption expenditures and household production time needed to achieve a minimum living standard.
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Working Paper No.798
01 May 2014
Quality of Match for Statistical Matches Using the American Time Use Survey 2010, the Survey of Consumer Finances 2010, and the Annual Social and Economic Supplement 2011
AbstractThis paper describes the quality of the statistical matching between the March 2011 supplement to the Current Population Survey and the 2010 American Time Use Survey and Survey of Consumer Finances, which are used as the basis for the 2010 LIMEW estimates for the United States. In the first part of the paper, the alignment of the datasets is examined. In the second, various aspects of the match quality are described. The results indicate that the matches are of high quality, with some indication of bias in specific cases.
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Strategic Analysis
25 April 2014
Is Rising Inequality a Hindrance to the US Economic Recovery?
AbstractThe US economy has been expanding moderately since the official end of the Great Recession in 2009. The budget deficit has been steadily decreasing, inflation has remained in check, and the unemployment rate has fallen to 6.7 percent. The restrictive fiscal policy stance of the past three years has exerted a negative influence on aggregate demand and growth, which has been offset by rising domestic private demand; net exports have had only a negligible (positive) effect on growth.As Wynne Godley noted in 1999, in the Strategic Analysis Seven Unsustainable Processes, if an economy faces sluggish net export demand and fiscal policy is restrictive, economic growth becomes dependent on the private sector’s continuing to spend in excess of its income. However, this continuous excess is not sustainable in the medium and long run. Therefore, if spending were to stop rising relative to income, without either fiscal relaxation or a sharp recovery in net exports, the impetus driving the expansion would evaporate and output could not grow fast enough to stop unemployment from rising. Moreover, because growth is so dependent on “rising private borrowing,” the real economy “is at the mercy of the stock market to an unusual extent.” As proved by the crisis of 2001 and the Great Recession of 2007–09, Godley’s analysis turned out to be correct.Fifteen years later, the US economy appears to be going down the same road again. Postrecession, foreign demand is still weak and the government is maintaining its tight fiscal stance. Once again, the recovery predicted in the latest Congressional Budget Office report relies on excessive private sector borrowing, and once again, the recovery is at the mercy of the stock market. Given that the income distribution has worsened since the crisis—continuing a 35-year trend—the burden of indebtedness will again fall disproportionally on the middle class and the poor. In order for the CBO projections to materialize, households in the bottom 90 percent of the distribution would have to start accumulating debt again in line with the prerecession trend while the stock of debt of the top 10 percent remained at its present level. Clearly, this process is unsustainable. The United States now faces a choice between two undesirable outcomes: a prolonged period of low growth—secular stagnation—or a bubble-fueled expansion that will end with a serious financial and economic crisis. The only way out of this dilemma is a reversal of the trend toward greater income inequality.
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Strategic Analysis
25 April 2014
Αποτελεί η αυξανόμενη ανισότητα εμπόδιο στην οικονομική ανάκαμψη των ΗΠΑ;
AbstractΗ οικονομία των Ηνωμένων Πολιτειών αναπτύσσεται με μέτριο ρυθμό μετά από την επίσημη λήξη της Ύφεσης το 2009. Το έλλειμμα του προϋπολογισμού μειώνεται σταθερά, ο πληθωρισμός βρίσκεται υπό έλεγχο και το ποσοστό ανεργίας μειώθηκε από 9,8% στο 6,7% (τον Μάρτιο του 2014). Η περιοριστική δημοσιονομική πολιτική των τελευταίων τριών ετών έχει ασκήσει αρνητική επίδραση στη συνολική ζήτηση και την ανάπτυξη, η οποία έχει αντισταθμιστεί από την αύξηση της εγχώριας ιδιωτικής ζήτησης. Οι καθαρές εξαγωγές είχαν αμελητέες (θετικές) επιπτώσεις στην ανάπτυξη. Όπως σημείωσε ο Wynne Godley to 1999, στην πρώτη έκδοση της σειράς «Στρατηγική Ανάλυση» που έφερε τον τίτλο «Seven Unsustainable Processes» (Επτά μη βιώσιμες διαδικασίες), αν μια οικονομία αντιμετωπίζει χαμηλή ζήτηση για καθαρές εξαγωγές και η δημοσιονομική πολιτική είναι περιοριστική, η οικονομική ανάπτυξη καθίσταται «εξαρτώμενη από την αύξηση του ιδιωτικού δανεισμού», δηλαδή από το να συνεχίζει ο ιδιωτικός τομέας να δαπανά πέραν του εισοδηματός του. Ωστόσο, αυτή η συνεχιζόμενη τάση, η επίμονη αύξηση στην αναλογία του χρέους προς το διαθέσιμο εισόδημα του ιδιωτικού τομέα δεν είναι βιώσιμη μεσοπρόθεσμα και μακροπρόθεσμα. Ως εκ τούτου, αν οι δαπάνες σταματήσουν να αυξάνονται σε σχέση με το εισόδημα, χωρίς να υπάρχει δημοσιονομική χαλάρωση ή απότομη ανάκαμψη των καθαρών εξαγωγών, η δυναμική της επέκτασης θα εξανεμισθεί και η παραγωγή δεν θα αυξηθεί αρκετά γρήγορα για να σταματήσει η άνοδος της ανεργίας. Επιπλέον, επειδή η ανάπτυξη εξαρτάται σε τόσο μεγάλο βαθμό από «την αύξηση του ιδιωτικού δανεισμού», η πραγματική οικονομία «βρίσκεται στο έλεος της χρηματιστηριακής αγοράς σε ασυνήθιστο βαθμό». Η ανάλυση του Godley αποδείχθηκε σωστή. Η κρίση του 2001 και η Ύφεση του 2007–09 επιβεβαίωσε τα συμπεράσματά του.
Δεκαπέντε χρόνια μετά, η οικονομία των ΗΠΑ φαίνεται να ακολουθεί και πάλι τον ίδιο δρόμο. Η εξωτερική ζήτηση παραμένει αδύναμη και η κυβέρνηση εφαρμόζει περιοριστική δημοσιονομική πολιτική. Για άλλη μια φορά, η ανάκαμψη που προβλέπεται από το Γραφείο Προϋπολογισμού του Κογκρέσου βασίζεται στον υπερβολικό δανεισμό του ιδιωτικού τομέα και, για άλλη μια φορά, είναι στο έλεος της χρηματιστηριακής αγοράς. Δεδομένου ότι η κατανομή του εισοδήματος έχει επιδεινωθεί από την εποχή της κρίσης, μια τάση που συνεχίζεται εδώ και 35 χρόνια, το βάρος του χρέους θα πέσει και πάλι δυσανάλογα στους ώμους της μεσαίας τάξης και στα φτωχότερα στρώματα του πληθυσμού. Στο πλαίσιο αυτό, για να υλοποιηθούν οι προβλέψεις του Γραφείου Προϋπολογισμού του Κογκρέσου, τα νοικοκυριά που ανήκουν στο εισοδηματικά κατώτερο 90% του πληθυσμού θα πρέπει να αρχίσουν να συσσωρεύουν και πάλι χρέος, σύμφωνα με την τάση των τελευταίων 30 ετών, ενώ το απόθεμα του χρέους για το εισοδηματικά ανώτερο 10% του πληθυσμού θα παραμείνει στα σημερινά του επίπεδα.
Είναι σαφές ότι η αυτή η διαδικασία δεν είναι βιώσιμη. Οι Ηνωμένες Πολιτείες είναι αντιμέτωπες με την επιλογή ανάμεσα σε δύο ανεπιθύμητα αποτελέσματα: μια παρατεταμένη περίοδο χαμηλής ανάπτυξης και στασιμότητας ή μια οικονομική επέκταση τροφοδοτούμενη από μια φούσκα που θα καταλήξει σε μια σοβαρή χρηματοπιστωτική και οικονομική κρίση. Η μόνη διέξοδος από αυτό το δίλημμα είναι να αντιστραφεί η τάση προς την αυξανόμενη εισοδηματική ανισότητα.
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Working Paper No.797
23 April 2014
Gender-responsive Budgeting as Fiscal Innovation
AbstractGender-responsive budgeting (GRB) is a fiscal innovation. Innovation, for the purposes of this paper, is defined as a way of transforming a new concept into tangible processes, resources, and institutional mechanisms in which a benefit meets identified problems. GRB is a fiscal innovation in that it translates gender commitments into fiscal commitments by applying a “gender lens” to the identified processes, resources, and institutional mechanisms, and arrives at a desirable benefit incidence. The theoretical treatment of gender budgeting as a fiscal innovation is not incorporated, as the focus of this paper is broadly on the processes involved. GRB as an innovation has four specific components: knowledge processes and networking, institutional mechanisms, learning processes and building capacities, and public accountability and benefit incidence. The paper analyzes these four components of GRB in the context of India. The National Institute of Public Finance and Policy has been the pioneer of gender budgeting in India, and also played a significant role in institutionalizing gender budgeting within the Ministry of Finance, Government of India, in 2005. The Expert Committee Group on “Classification of Budgetary Transactions” makes recommendations on gender budgeting—Ashok Lahiri Committee recommendations—that will become part of the institutionalization process, integrating the analytical matrices of fiscal data through a gender lens and also the institutional innovations for GRB. Revisiting the 2004 Lahiri recommendations and revamping the process of GRB in India is inevitable, at both ex ante and ex post levels.
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Research Project Report
11 April 2014
Federal Reserve Bank Governance and Independence during Financial Crisis
AbstractThis monograph is part of the Levy Institute’s Research and Policy Dialogue Project on Improving Governance of the Government Safety Net in Financial Crisis, a two-year project funded by the Ford Foundation.Download Research Project Report, April 2014 PDF (1.33 MB)
This is the third in a series of reports examining the Federal Reserve Bank’s response to the global financial crisis, with particular emphasis on questions of accountability, democratic governance and transparency, and mission consistency. In this year’s report, we focus on issues of central bank independence and governance, with particular attention paid to challenges raised during periods of crisis. We trace the principal changes in governance of the Fed over its history—changes that accelerate during times of economic stress. We pay special attention to the famous 1951 “Accord” and to the growing consensus in recent years for substantial independence of the central bank from the treasury. In some respects, we deviate from conventional wisdom, arguing that the concept of independence is not usually well defined. While the Fed is substantially independent of day-to-day politics, it is not operationally independent of the Treasury. We examine in some detail an alternative view of monetary and fiscal operations. We conclude that the inexorable expansion of the Fed’s power and influence raises important questions concerning democratic governance that need to be resolved. -
Public Policy Brief No.131
08 April 2014
Minsky and Dynamic Macroprudential Regulation
AbstractIn the context of current debates about the proper form of prudential regulation and proposals for the imposition of liquidity and capital ratios, Senior Scholar Jan Kregel examines Hyman Minsky’s work as a consultant to government agencies exploring financial regulatory reform in the 1960s. As Kregel explains, this often-overlooked early work, a precursor to Minsky’s “financial instability hypothesis”(FIH), serves as yet another useful guide to explaining why regulation and supervision in the lead-up to the 2008 financial crisis were flawed—and why the approach to reregulation after the crisis has been incomplete.
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Public Policy Brief No.131
08 April 2014
Ο Μίνσκι και η δυναμική μακροπροληπτική ρύθμιση
AbstractΣτο πλαίσιο των σημερινών συζητήσεων σχετικά με την κατάλληλη μορφή της μακροληπτικής ρύθμισης και των προτάσεων για την επιβολή ορίων στα επίπεδα ρευστότητας και κεφαλαίων, ο ανώτατος μελετητής Jan Kregel εξετάζει το έργο του Μίνσκι ως σύμβουλος κυβερνητικών υπηρεσιών που διερευνούσαν το ζήτημα της ρυθμιστικής μεταρρύθμισης τη δεκαετία του 1960. Όπως εξηγεί ο Kregel, αυτή η παραγκωνισμένη συνεισφορά του Μίνσκι, που συγκροτεί ουσιαστικά τον προκάτοχο της «υπόθεσης της χρηματοοικονομικής αστάθειας»,αποτελεί ένα επιπλέον χρήσιμο οδηγό στην προσπάθεια να εξηγήσουμε γιατί το καθεστώς της κανονιστικής ρύθμισης και της εποπτείας την περίοδο πριν από την κρίση του 2008 ήταν βαθιά ελαττωματικό, αλλά και γατί η προσέγγιση αναφορικά με την κανονιστική ρύθμιση παραμένει σήμερα άκρως προβληματική.
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Working Paper No.796
04 April 2014
Minsky and the Subprime Mortgage Crisis
AbstractThe aim of this paper is to develop a structural explanation of the subprime mortgage crisis, grounded on the combination of two apparently incompatible financial theories: the financial instability hypothesis by Hyman P. Minsky and the theory of capital market inflation by Jan Toporowski. Our thesis is that, once the evolution of the financial market is taken into account, the financial Keynesianism of Minsky is still a valid framework to understand the events leading to the crisis.
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Working Paper No.795
04 April 2014
Growth with Unused Capacity and Endogenous Depreciation
AbstractThis paper contributes to the debate on income growth and distribution from a nonmainstream perspective. It looks, in particular, at the role that the degree of capacity utilization plays in the process of growth of an economy that is not perfectly competitive. The distinctive feature of the model presented in the paper is the hypothesis that the rate of capital depreciation is an increasing function of the degree of capacity utilization. This hypothesis implies analytical results that differ somewhat from those yielded by other Kaleckian models. Our model shows that, in a number of cases, the process of growth can be profit-led rather than wage-led. The model also determines the value to which the degree of capacity utilization converges in the long run.
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Working Paper No.794
31 March 2014
Structural Asymmetries at the Roots of the Eurozone Crisis
AbstractIn this paper, we analyze and try to measure productive and technological asymmetries between central and peripheral economies in the eurozone. We assess the effects such asymmetries would likely bring about on center–periphery divergence/convergence patterns, and derive some implications as to the design of future industrial policy at the European level. We stress that future European Union (EU) industrial policy should be regionally focused and specifically target structural changes in the periphery as the main way to favor center–periphery convergence and avoid the reappearance of past external imbalances. To this end, a wide battery of industrial policy tools should be considered, ranging from subsidies and fiscal incentives to innovative firms, public financing of R & D efforts, sectoral policies, and public procurements for home-produced goods. All in all, future EU industrial policy should be much more interventionist than it currently is, and dispose of much larger funds with respect to the present setting in order to effectively pursue both short-run stabilization and long-run development goals.
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Working Paper No.793
27 March 2014
Quality of Statistical Match and Employment Simulations Used in the Estimation of the Levy Institute Measure of Time and Income Poverty (LIMTIP) for South Korea, 2009
AbstractThe quality of match of the statistical match used in the LIMTIP estimates for South Korea in 2009 is described. The match combines the 2009 Korean Time Use Survey (KTUS 2009) with the 2009 Korean Welfare Panel Study (KWPS 2009). The alignment of the two datasets is examined, after which various aspects of the match quality are described. The match is of high quality, given the nature of the source datasets. The method used to simulate employment response to availability of jobs in the situation in which child-care subsidies are available is described. Comparisons of the donor and recipient groups for each of three stages of hot-deck statistical matching are presented. The resulting distribution of jobs, earnings, usual hours of paid employment, household production hours, and use of child-care services are compared to the distribution in the donor pools. The results do not appear to be anomalous, which is the best that can be said of the results of such a procedure.
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Working Paper No.792
05 March 2014
From the State Theory of Money to Modern Money Theory
AbstractThis paper explores the intellectual history of the state, or chartalist, approach to money, from the early developers (Georg Friedrich Knapp and A. Mitchell Innes) through Joseph Schumpeter, John Maynard Keynes, and Abba Lerner, and on to modern exponents Hyman Minsky, Charles Goodhart, and Geoffrey Ingham. This literature became the foundation for Modern Money Theory (MMT). In the MMT approach, the state (or any other authority able to impose an obligation) imposes a liability in the form of a generalized, social, legal unit of account—a money—used for measuring the obligation. This approach does not require the preexistence of markets; indeed, it almost certainly predates them. Once the authorities can levy such obligations, they can name what fulfills any obligation by denominating those things that can be delivered; in other words, by pricing them. MMT thus links obligatory payments like taxes to the money of account as well as the currency. This leads to a revised view of money and sovereign finance. The paper concludes with an analysis of the policy options available to a modern government that issues its own currency.
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Working Paper No.791
05 March 2014
Central Bank Independence
AbstractIt is commonplace to speak of central bank “independence” as if it were both a reality and a necessity. While the Federal Reserve is subject to the “dual mandate,” it has substantial discretion in its interpretation of the vague call for high employment and low inflation. Most important, the Fed’s independence is supposed to insulate it from political pressures coming from Congress and the US Treasury to “print money” to finance budget deficits. As in many developed nations, this prohibition was written into US law from the founding of the Fed in 1913. In practice, the prohibition is easy to evade, as we found during World War II, when budget deficits ran up to a quarter of US GDP. If a central bank stands ready to buy government bonds in the secondary market to peg an interest rate, then private banks will buy bonds in the new-issue market and sell them to the central bank at a virtually guaranteed price. Since central bank purchases of securities supply the reserves needed by banks to buy government debt, a virtuous circle is created, so that the treasury faces no financing constraint. That is what the 1951 Accord was supposedly all about: ending the cheap source of US Treasury finance. Since the global financial crisis hit in 2007, these matters have come to the fore in both the United States and the European Monetary Union, with those worried about inflation warning that the central banks are essentially “printing money” to keep sovereign-government borrowing costs low.
This paper argues that the Fed is not, and should not be, independent, at least in the sense in which that term is normally used. The Fed is a “creature of Congress,” created by public law that has evolved since 1913 in a way that not only increased the Fed’s assigned responsibilities but also strengthened congressional oversight. The paper addresses governance issues, which, a century after the founding of the Fed, remain somewhat unsettled. While the Fed should be, and appears to be, insulated from day-to-day political pressures, it is subject to the will of Congress. Further, the Fed cannot really be independent from the Treasury, because the Fed is the federal government’s bank, with almost all payments made by and to the government running through the Fed. As such, there is no “operational independence” that would allow the Fed to refuse to allow the Treasury to spend appropriated funds. Finally, the paper addresses troubling issues raised by the Fed’s response to the global financial crisis; namely, questions about transparency, accountability, and democratic governance.
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Working Paper No.790
05 March 2014
Changes in Global Trade Patterns and Women’s Employment in Manufacturing
AbstractThe purpose of this study is to explore the employment effects of changes in manufacturing output resulting from shifting trade patterns over the period 1995–2006. For 30 countries (21 OECD and 9 non-OECD countries) we estimate the changes in embodied labor content due to trade using factor-content analysis, breaking up the sources of these changes between trade with the North, the South and China. We also decompose changes in employment into its component changes within and across sectors. Our results present a net negative impact of trade on total employment in 30 countries over the period of analysis (despite employment gains in 17 countries). Except for the Philippines and the Republic of Korea, trade with China has a negative impact on total employment in all countries, with a stronger negative effect on women’s employment. Employment losses in the South due to a surge in imports from China are coupled with declining exports to the North, as many countries in the North shift their imports to emerging economies in Asia. Decomposition results indicate that the decline in the share of women’s employment is mainly due to shifts between sectors rather than changes within sectors. Changes in women’s employment are still highly dependent on movements in “traditional” manufacturing sectors, including food, textiles, and wearing apparel.
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Working Paper No.789
03 March 2014
Full Employment
AbstractIt is common knowledge that John Maynard Keynes advocated bold government action to deal with recessions and unemployment. What is not commonly known is that modern “Keynesian policies” bear little, if any, resemblance to the policy measures Keynes himself believed would guarantee true full employment over the long run. This paper corrects this misconception and outlines “the road not taken”; that is, the long-term program for full employment found in Keynes’s writings and elaborated on by others in works that are missing from mainstream textbooks and policy initiatives. The analysis herein focuses on why the private sector ordinarily fails to produce full employment, even during strong expansions and in the presence of strong government action. It articulates the reasons why the job of the policymaker is, not to “nudge” private firms to create jobs for all, but to do so itself directly as a matter of last resort. This paper discusses various designs of direct job creation policies that answer Keynes’s call for long-run full employment policies.
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Working Paper No.789
03 March 2014
Πλήρης Απασχόληση
AbstractΕίναι κοινώς γνωστό ότι ο John Maynard Keynes υπήρξε ο βασικός υποστηρικτής του κρατικού παρεμβατισμού για την αντιμετώπιση της ύφεσης και της ανεργίας. Αυτό που δεν είναι ευρέως γνωστό είναι ότι οι σύγχρονες «κεϋνσιανές πολιτικές» δεν έχουν τίποτα το κοινό με τα μέτρα πολιτικής που ο ίδιος ο Keynes θεωρούσε απαραίτητα για την επίτευξη της μακροπρόθεσμης, πλήρους πραγματικής απασχόλησης. Η παρούσα εργασία έχει ως σκοπό να διορθωθεί αυτή η παρανόηση και να περιγράψει τον δρόμο που δεν ακολουθήθηκε—δηλαδή το μακροπρόθεσμο πρόγραμμα για την πλήρη απασχόληση που υπάρχει στα γραπτά του Keynes και που επεξεργάστηκαν μετέπειτα οικονομολόγοι, αλλά το έργο των οποίων δεν αναφέρεται στα οικονομικά εγχειρίδια του κυρίαρχου ρεύματος και δεν λαμβάνεται υπόψη από τους χαράκτες πολιτικής. Η ανάλυση που ακολουθεί επικεντρώνεται στους λόγους για τους οποίους ο ιδιωτικός τομέας αδυνατεί, συνήθως, να παράγει πλήρη απασχόληση, ακόμα και κατά τη διάρκεια περιόδων οικονομικής επέκτασης και υπό καθεστώς κρατικού παρεμβατισμού, και επιχειρηματολογεί για ποιο λόγο η δουλειά των χαρακτών πολιτικής δεν είναι να «τσιγκλούν» τις ιδιωτικές επιχειρήσεις να δημιουργήσουν θέσεις εργασίας για όλους, αλλά να το πράξουν οι ίδιοι άμεσα ως ζήτημα ύστατης προσφυγής. Η εργασία εξετάζει διάφορες πολιτικές άμεσης δημιουργίας θέσεων εργασίας στο πλαίσιο της φιλοσοφίας του Keynes για την πλήρη απασχόληση.
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Working Paper No.788
03 March 2014
Modern Money Theory and Interrelations between the Treasury and the Central Bank
AbstractOne of the main contributions of Modern Money Theory (MMT) has been to explain why monetarily sovereign governments have a very flexible policy space that is unconstrained by hard financial limits. Not only can they issue their own currency to pay public debt denominated in their own currency, but they can also easily bypass any self-imposed constraint on budgetary operations. Through a detailed analysis of the institutions and practices surrounding the fiscal and monetary operations of the treasury and central bank of the United States, the eurozone, and Australia, MMT has provided institutional and theoretical insights into the inner workings of economies with monetarily sovereign and nonsovereign governments. The paper shows that the previous theoretical conclusions of MMT can be illustrated by providing further evidence of the interconnectedness of the treasury and the central bank in the United States.
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One Pager No.46
12 February 2014
Φτώχεια χρόνου και κατανάλωσης στην Τουρκία
AbstractΤο Μέτρο Φτώχειας Χρόνου και Κατανάλωσης του Levy Institute (LIMTCP) είναι ένα δισδιάστατο μέτρο που λαμβάνει υπόψη τόσο τις απαραίτητες καταναλωτικές δαπάνες όσο και το χρόνο που απαιτείται από τα νοικοκυριά για την επίτευξη ενός ελάχιστου επιπέδου διαβίωσης, παράγοντες που συχνά αγνοούνται από την επίσημη μέτρηση της φτώχιας. Στην περίπτωση της Τουρκίας, η εφαρμογή του LIMTCP αποκαλύπτει την ύπαρξη κρυφής φτώχειας για επιπλέον 7,6 εκατομμύρια άτομα, με αποτέλεσμα το ποσοστό φτώχειας να είναι 10 ποσοστιαίες μονάδες υψηλότερο από το επίσημο ποσοστό φτώχειας, που καταγράφεται στο 30%.
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One Pager No.46
12 February 2014
Time and Consumption Poverty in Turkey
AbstractThe Levy Institute Measure of Time and Consumption Poverty (LIMTCP) is a two-dimensional measure that takes into account both the necessary consumption expenditures and the household production time needed to achieve a minimum standard of living—factors often ignored in official poverty measures. In the case of Turkey, application of the LIMTCP reveals an additional 7.6 million people living in poverty, resulting in a poverty rate that is a full 10 percentage points higher than the official rate of 30 percent.
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