In The News

The End of a Gilded Age

Harold James January 6, 2009
Waves of globalization are characterized by intense innovation, along with increased wealth, productivity and consumption, notes Princeton professor Harold James in an opinion essay for the Baltimore Examiner. Agriculture gave way to manufacturing, manufacturing gave way to services, and services gave way to online interactions, and James notes that “In each case, a dramatic crisis created the...

US and China Must Tame Imbalances Together

Michael Pettis January 6, 2009
With surging liquidity and massive trade imbalances, no one should have been surprised by the global economic crisis, because as finance professor of Peking University Michael Pettis explains, this has been the historical pattern. Pettis details the history of the crisis, starting in 1980s, when US policy encouraged securitization of mortgages, converting illiquid assets into highly liquid...

Battle in a Poor Land for Riches Beneath the Soil

Lydia Polgreen December 29, 2008
Africa's natural resources – oil, diamonds and now uranium – immediately invite conflict among factions. Increased energy needs of emerging economic giants like China and India, as well as the rising interest in nuclear power as an alternative energy source due to climate change, increase global demand for uranium. On paper, increased trade profits would seem a huge benefit to Niger, one of...

OPEC and the Prisoner's Dilemma

Kurt Zenz House December 25, 2008
The prisoner’s dilemma is a part of game theory. Two prisoners who committed a crime each have three options: Both cooperate and receive penalties; cooperate with the police while hoping the other does not do likewise and enjoy a reduced sentence; refuse to cooperate and hope the partner does likewise. The dilemma demonstrates how capitalizing on the personal interest, when participants do not...

Wheels of Recession

Nayan Chanda December 22, 2008
Intricate global links among industries and suppliers mean the failure of one industry can be devastating for many others around the globe. “Outsourcing and off-shore production have changed the ecosystem of auto production so dramatically that the fate of millions of jobs all over the world hinges on a decision in Washington,” writes YaleGlobal editor Nayan Chanda in his column for Businessworld...

Emerging Economies to Reap From Global Crisis

Dani Rodrik December 19, 2008
Because of the global economic crisis, emerging economies will gain more power in global institutions, as the crisis has diminished both financial and political influence for the US and Europe. Emerging economies like South Korea, Brazil, India and China command a greater share of the global economy, and the developing nations must prepare for their new role, advises Dani Rodrik, political...

The Crisis Gives the US New Financial Power

Ricardo Hausmann December 19, 2008
The global financial crisis has reduced savings of the world’s wealthiest nations, but that does not necessarily reduce their power, suggests Ricardo Hausmann, director of Harvard’s Center for International Development, in an essay for the Financial Times. Nations can retain power, depending on how they borrow or spend. “The financial meltdown has translated into a sudden stop in capital flows to...