-- this post authored by Diego Daruich, William Easterly and Ariell Reshef
National trade policies have been at the heart of recent policy debates, with many calls for industrial policies to help pick winners. This column shows that while a few export goods account for the bulk of export value within each country, hyper-specialisations are very unstable, making it unlikely that industrial policy will work even in the medium run. The best policy to promote exports would be just to let entrepreneurs exploit new opportunities as they arise.
- this post authored by Eilyn Yee Lin Chong, Ashoka Mody and Francisco Varela Sandoval
Recent research suggests a point beyond which the benefits of financial development diminish, and further development can even hurt growth. This column describes how a negative relationship between credit and growth emerged strongly after 1990 and was particularly pronounced in the Eurozone, consistent with the notion that an overgrown financial sector weakens economic growth potential. It also argues that slower growth leads to more rapid financial sector expansion. Policymakers need to be aware of the possibility that causality runs in both directions.
January 20th, 2017
in aa syndication
by Philip Pilkington
On a recent blogpost that I wrote there was some confusion in the comments section regarding Hyman Minsky’s theories and their relationship to the phenomenon of rising asset prices. I have seen this confusion made many times before — even by some otherwise good Post-Keynesian economists — but I think that it is time to finally clear it up once and for all.
January 18th, 2017
in home sales and home prices
-- this post authored by Jack Cookson
- Residential remodeling is arguably a better indicator of consumer sentiment than new construction, and is of similar importance as an indicator of national economic health.
- Remodeling of existing homes is 17.5% above its 2009 housing bust level, but remains 10.8% below its 2005 housing boom level, and that new home construction is 48.9% above its 2009 level, but remains 48.6% below its 2005 level.
- Year-over-year, residential new construction increased by 14.0% and residential remodeling increased by 1.9%.