New Delhi: Oxford University Press, 2019; pp xx + 295, ₹
895.
Oxford: Oxford University Press, 2019; pp xxiv + 577, price not indicated.
Asia’s Journey to Prosperity: Policy, Market, and Technology Over 50 Years by Asian Development Bank,
Manila: ADB, 2020 (ebook), http://dx.doi.org/10.22617/TCS190290.
The transformation of Asia from its status as the most impoverished region to the growth locomotive of the world economy within five decades is unprecedented and nothing short of a miracle. The achievement seems all the more profound when juxtaposed with a very pessimistic outlook of Asia’s development prospects made by Gunnar Myrdal in his three-volume tome
Asian Drama: An Inquiry into the Poverty of Nations, published in 1968.
Introduction
Unexpected shocks may tip countries with elevated fiscal vulnerabilities into default. The literature has emphasized the role of macroeconomic and financial shocks, such as a decline of commodity prices (Reinhart et al., 2016) or banking crises (Baltenau and Erce, 2018) in shaping sovereign risk. However, other types of shocks, such as political events or natural disasters, are equally important.
2 Extreme weather events appear especially salient in light of the key role played by natural disasters in recent sovereign default episodes (i.e. Grenada 2004, and Antigua y Barbuda 2004 and 2009), the climate crisis, and the recent emphasis on incorporating natural-disaster risk as a component of macroeconomic risk management. In particular, the increase in the frequency and intensity of natural disasters, has led several economists and policy makers to advocate in favor of adopting disaster clauses that allow for a temporary debt moratorium when countries are hit by catas
Elga Bartsch, Agnès Bénassy-Quéré, Giancarlo Corsetti, Xavier Debrun 15 December 2020
When the COVID-19 crisis hit, neither monetary easing nor fiscal support alone was sufficient to buffer the shock. Monetary and fiscal authorities had to join forces to deliver the required macroeconomic backing, blurring the traditional boundaries between monetary and fiscal interventions. While some interpret these developments as the end of a decades-old consensus on the respective roles of central banks and treasuries, others see a stress test calling for the existing paradigm to adapt. Putting the notion of policy mix at the centre of the discussion, this column argues that policymakers have usefully exploited complementarities between monetary and fiscal instruments. However, such monetary-fiscal coordination can only work if the credibility of commitments to desirable long-term goals – healthy growth under price stability and public debt sustainability – is preserved and backe
Andrei Levchenko, Julian di Giovanni
After decades of globalisation, the structure of production is increasingly international, with supply chains crossing country borders. An important feature of this internationalisation of production is that the bulk of international trade linkages in a typical economy are held by only a few large firms (Freund and Pierola 2015). As a result, while only a minority of firms have direct trade linkages with foreign countries, those firms tend to account for a large share of aggregate economic activity (di Giovanni et al. 2017, 2018). How resilient is such an economy then to foreign business cycle shocks?
Our recent paper (di Giovanni et al. 2020) quantifies the consequences of a foreign shock to such an economy to study international shock transmission. Our point of departure is that even purely aggregate foreign shocks affect firms differentially depending on the extent and nature of their international linkages. In that sense, an aggregate shoc