In The News

Capitalism Divides

Nayan Chanda May 6, 2009
As pundits debate whether intervention in financial markers, or the lack thereof, was the cause of the current financial crisis, what is missing from the debate is a critique of capitalism. Whether greed multiplied 30 times through the use of debt and derivatives or the vicious cycle of twin deficits and currency manipulation caused the collapse misses the point. Assuming capitalism is safe – the...

Two Views on the Cause of the Global Crisis – Part II

Ashok Bardhan May 6, 2009
Lax regulation may have been the lever that pushed the world into the present financial crisis, but the fulcrum was the twin excesses of over-financialization and over-globalization, according to UC Berkeley economist Ashok Bardhan. In the case of over-financialization, financial asset bubbles rose to several times the global GDP, leading to an overheating of the economy. Meanwhile, over-...

Two Views on the Cause of the Global Crisis – Part I

Branko Milanovic May 4, 2009
The global financial crisis that has devastated the world economy has spawned a growing literature on its causes. In part one of our two-part series, World Bank economist and Carnegie Endowment scholar Branko Milanovic argues that while analysts can quibble over the contributing factors to the financial meltdown, a deeper, more fundamental problem was the real cause: income inequality. Growing...

China Tries to Wriggle Out of the US Dollar Trap

Wenran Jiang April 29, 2009
While the world waits for China to flex its economic muscle to ease the crisis, China’s exposure to the US dollar is a bigger issue with which the country has to contend. According to China scholar Wenran Jiang, Beijing is already taking significant steps to rectify this situation. Nonetheless, with over $1 trillion in US dollar denominated reserves, and additional exposure through trading...

China Steps Up to World Stage, Cautiously

François Godement April 24, 2009
Though commentators were expecting China to approach the G-20 as an Asian Goliath, what they got instead was the traditional cautious dragon. As Asia specialist François Godement argues, such reticence to playing a bigger part on the global stage should not come as a surprise. But that doesn’t mean there weren’t some unexpected events. President Hu Jintao meeting...

Tainted Chinese Drywall Contaminating U.S. Homes

Charlotte Cuthbertson April 20, 2009
If the US housing market doesn’t have enough problems already, it now has an additional one from thousands of miles away. Drywall imported from China has been found to contain contaminants that can form corrosive sulfuric acid, creating a new worry for home-owners. Affected houses often smell like rotten eggs and home dwellers suffer a slew of health problems – from relatively benign runny noses...

Capitalism’s Future Lies in Networks and Cooperation

Farok Contractor April 20, 2009
In the past, adversarial competition and in-house design and production typified the climate and model for business success. Today, that climate has changed, according to management professor Farok Contractor. Cooperation and networks are the new tools for success in the global economy for a whole host of reasons. First, many projects are so large that one company cannot possibly shoulder the...