From cepr.org
US military strength secures financial dominance
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The US stands unrivalled as both a military and financial superpower. This column uses a game-theoretic model to show how the global dominance of the US dollar – what economists call the ‘exorbitant privilege’ – is inextricably linked to America’s unmatched military strength. This dual hegemony...
on Sat, 3AM
From cepr.org
Chinese infrastructure lending and Africa's global value chain participation
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Chinese lending to African countries has surged over the past 15 years, primarily aimed at financing infrastructure projects. This column shows that by lowering trade costs, Chinese infrastructure loans are linked to increased participation in global value chains, particularly in downstream...
on Thu, 7PM
From cepr.org
China’s military rise: Comparative military spending in China and the US
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Estimates of China’s military spending relative to the US vary widely from around one quarter of US spending to near parity. This column argues that the use of appropriate relative prices and unbiased economic measurement techniques greatly reduces the range of reasonable estimates. Given...
on Tue, 9AM
From cepr.org
The European energy crisis and the consequences for the global natural gas market
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The 2022 Russian invasion of Ukraine severely disrupted European gas markets. Energy costs rose steeply, global natural gas flows were significantly reoriented, and policymakers’ focus shifted towards energy security. This column examines how the conflict has reshaped the natural gas market,...
on Sun, 5PM
From cepr.org
Experiencing natural disasters increases partisan disagreement on climate change
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As climate-related disasters become increasingly frequent and destructive, one might expect first-hand experience of these events to bring consensus on the urgency of addressing climate change. Yet, the deep ideological divide on this issue in the US and beyond – combined with highly polarised...
on Dec 4
From cepr.org
Italy’s long-term economic performance: New GDP estimates since the Middle Ages
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There is a lively debate around the long-run performance of Italy since the Middle Ages. This column introduces new estimates of Italy's GDP per capita from 1300 to 1861. The estimates are constructed using the demand-side approach and are based on nearly 95,000 price/wage observations from...
on Dec 2
From cepr.org
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Policy discussions around online anonymity have intensified in academic and professional communities. While anonymity facilitates free expression, it also liberates offensive conduct. This column identifies links between the Economics Job Market Rumors forum and patterns of user behaviour....
on Nov 25
From cepr.org
Russia’s economic war propaganda
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One of the narratives being pushed by Russia is that its economy is doing better than the West, and that sanctions are not working. This column looks at how the Russian economy worked before the invasion in 2022 and some of key statistics currently coming out from Russian authorities. The...
on Nov 20
From cepr.org
A new history of wealth inequality in the West
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Western nations have seen remarkable per capita wealth growth over the 20th century and, in this period, wealth inequality has also fallen. This column explains this development by the emergence of inclusive political and economic institutions that broadened access to homeownership and pensions...
on Nov 19
From cepr.org
Financing Europe’s grand ideas
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A large proportion of the financing needs for Europe’s digital, energy, and demographic transitions, as well as defence, will have to be covered by public funding. This column argues that these can all be seen as European public goods, and that a first step towards achieving them should to...
on Nov 17
From cepr.org
Punishment without crime? The Gulag as a worker-discipline device
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In capitalist economies, firms pay higher wages to motivate workers who fear unemployment. In Soviet Russia, Stalin used the Gulag to discipline workers. The economic rationale of the ‘efficiency wage’ model helps explain the cruel brutality of Stalin’s prison camps.
on Nov 15
From cepr.org
First-in, first-out: Driving the UK's per capita carbon dioxide emissions below 1860 levels
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The Industrial Revolution has been of vast benefit to humanity, but it came at the cost of a global explosion in anthropogenic emissions of greenhouse gases. The UK was the first country into the Industrial Revolution. Now it is one of the first countries heading out, with annual CO2 emissions...
on Nov 14
From cepr.org
US electoral impact of remote work and inter-state migration
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Remote work and geographic mobility have surged in the US since 2020. This column examines trends for both and discusses the potential electoral implications. The authors find that remote work opportunities are disproportionately located in left-leaning areas, state-movers are 45% more likely to...
on Nov 4
From cepr.org
What financial markets say about the economic implications of a potential Trump election victory
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There is large uncertainty around the economic effects a second Trump term would have. This column assesses the potential implications of Trump winning the upcoming election through the lens of financial market participants. The authors find that investors associate a higher likelihood of Trump...
on Oct 28
From cepr.org
The Medici’s quiet coup: How the wealthy bend politics without shifting institutions
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The Medici family ruled Florence for nearly 300 years, patronising the arts and making Florence a cultural centre of Europe. But there was a dark side to Medici rule. This column studies the circumstances under which a relatively open political system can be corrupted by its confrontation with...
on Oct 22
From cepr.org
Economic losses from climate change are probably larger than you think: New NGFS scenarios
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Recent research suggests that the impact of climate change on economic output might have been underestimated in the past. This column reviews the results from various damage functions used to estimate economic losses induced by climate change. It also elaborates on the choice of damage function...
on Oct 22
From cepr.org
DP19572 Inequality in Science: Who Becomes a Star?
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How does a person’s childhood socioeconomic status (SES) influence their chances to participate and succeed in science? To investigate this question, we use machine-learning methods to link scientists in a comprehensive biographical dictionary, the American Men of Science (1921), with their...
on Oct 21
From cepr.org
The rapid adoption of generative AI
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The impact of generative AI on the economy hinges on whether it improves productivity in many important work tasks, and how quickly and intensively is it being adopted. This column uses survey data from the US to reveal that generative AI has been adopted quite rapidly compared with other...
on Oct 21
From cepr.org
Who holds sovereign debt and why it matters
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Globally, government debt has increased substantially since the onset of the Covid-19 pandemic and geopolitical tensions. This columns asks who the investors that hold government debt are, and whether the ownership composition matters. Overall, as debt increases, non-bank investors, in...
on Oct 17
From cepr.org
Economists should point their attention to the stars
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The economics of space is no longer the province of science fiction. However, the economics profession has paid little attention to space exploration as a dynamic market. This column argues that economists should turn their attention to the stars, harnessing opportunities that beckon beyond...
on Oct 17
From cepr.org
Should AI stay or should AI go: The promises and perils of AI for productivity and growth
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There is considerable disagreement about the growth potential of artificial intelligence. Though emerging micro-level evidence shows substantial improvements in firm productivity and worker performance, the macroeconomic effects are uncertain. This column argues that the promise of AI-related...
on Oct 8
From cepr.org
Draghi’s real message on European competition enforcement: “Not delivering on innovation and growth”
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The Draghi report on the future of European competitiveness has been largely well received, although concerns have been raised that Draghi is prescribing a rollback of competition enforcement and regulation, particularly in telecoms and digital. This column argues that this is a...
on Oct 6
From cepr.org
DP19551 Access to Opportunity in the Sciences: Evidence from the Nobel Laureates
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Unequal opportunity in the sciences reduces scientific contributions from the most talented individuals and limits the rate of human progress. We study unequal opportunity by collecting data on the childhood SES of Nobel laureates in the sciences. The average laureate grew up in an 87–90th...
on Oct 3
From cepr.org
Measuring economic losses caused by climate change
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Extreme weather events are bringing devastating consequences for an increasing number of people and countries, so quantifying their economic impact is highly relevant. The effect of changes in climate-related variables on economic output is typically estimated using a ‘damage function’. The...
on Oct 2
From cepr.org
How machine learning is aiding the fight against mafia infiltration in Italy
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In Italy, criminal organisations infiltrate municipal bodies to control public resources and manipulate elections. Detecting this infiltration, however, is difficult. This column proposes a machine-learning model that can predict mafia infiltration before it becomes evident and flag ‘high-risk’...
on Oct 1
From cepr.org
The end of development economics
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Some decades ago, development economists saw their approach as being distinctive compared to mainstream economics in general and better grounded in the reality of actual economies. This column argues that two trends over the last decades – the significant improvement in the average income of...
on Sep 27
From cepr.org
Public investment: The orphan of politics
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If constrained by EU rules, fiscal policymakers will cut or postpone public investment. This seemingly obvious point came up regularly in the policy debate around the latest reform of the EU fiscal framework. This column argues that the reality is more complex. Governments lamenting a stifling...
on Sep 15
From cepr.org
US tariffs are an arbitrary and regressive tax
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Tariffs – taxes on imported goods – likely impose a heavier burden on lower-income households, as these households generally spend more on traded goods as a share of expenditure/income and because of the higher level of tariffs placed on some key consumer goods. This column estimates the tariff...
on Sep 13
From cepr.org
The digital euro can strengthen financial stability, with limits
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The ECB’s Governing Council moved to the preparation phase of the digital euro in October 2023. This column studies the implications of the digital euro for financial stability. New survey data indicate that German households are open to the digital euro. However, the demand for digital euro...
on Sep 13
From cepr.org
The Billion Prices Project: Using online data for measurement and research
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Big Data is changing the world, even economics. This column describes MIT’s Billion Prices Project and discusses key lessons for both inflation measurement and some fundamental research questions in macro and international economics. Online prices can be used to construct daily price indexes in...
on Sep 11
From cepr.org
DP17779 Competition and Defaults in Online Search
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This paper offers the first systematic quantitative assessment of default-option interventions designed to mitigate Google's search dominance. By analyzing interventions in the European Economic Area, Russia, and Turkey, we find that, across all three cases, changes to default settings...
on Aug 12
From cepr.org
Trade, war, and reconstruction
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If leaders take the costs of destroying trade into account, they may be more likely to prevent a conflict from escalating into a military confrontation, particularly if their country is open to international trade. This column points out, however, that rather than always acting as a factor of...
on Aug 9
From cepr.org
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More new research from the PSE-CEPR Policy Forum 2024. Data about the personal finances of the richest people in our society is hard to find. A team of economists in France have attempted to answer a question that increasing preoccupies both policymakers and the public: how much tax do the...
on Aug 9
From cepr.org
The US fiscal mess: Some unpleasant fiscal simulations
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Based on recent projections, the US federal debt is expected to grow to historic highs over the next decade. This column uses the FRB-US model to simulate fiscal scenarios for the US. Across all fiscal consolidations considered, the debt/GDP ratio and interest bill increase at least until...
on Jul 28
From cepr.org
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The rapid adoption of artificial intelligence is transforming the financial industry. This first of a two-column series argues that AI may either increase systemic financial risk or act to stabilise the system, depending on endogenous responses, strategic complementarities, the severity of...
on Jul 27
From cepr.org
The global semiconductor talent crunch: How protectionism backfired
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The US aims to revitalise its domestic semiconductor manufacturing industry, but will there be enough skilled workers to meet the ambitious goals? This column presents evidence, based on a global dataset of 1.6 million employees with chip manufacturing skills, that US protectionist policies –...
on Jul 24
From cepr.org
The effect of productivity growth on within-firm inequality
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Wage inequality has increased dramatically in the US since the 1970s, largely driven by within-firm earnings inequality. This column uses combined data from three large micro datasets to study the drivers and implications of within-firm inequality. It shows that employees across the entire wage...
on Jul 11
From cepr.org
Gendered change: 150 years of transformation in US hours
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The 2023 Nobel Committee awarded the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel to Claudia Goldin. Among her many contributions is the emphasis on the non-monotonic trend in women’s employment over the course of US history, as the result of structural change and...
on Jul 10
From cepr.org
New index tracks financial stress across the globe
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Episodes of high financial stress have occurred both globally and in specific countries over the past six decades. This column introduces a new quarterly financial stress index for 110 countries, constructed using country reports from the Economist Intelligence Unit. This index has wider...
on Jun 26
From cepr.org
How influencer cartels manipulate social media: Fraudulent behaviour hidden in plain sight
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Social media influencers account for a growing share of marketing budgets worldwide. This column examines a problem within this rapidly expanding advertising market – influencer cartels, in which groups of influencers collude to increase advertising revenue by inflating each other’s engagement...
on Jun 5
From cepr.org
Selling England (no longer) by the pound: Currency mismatches and the dollarisation of UK exports
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In the aftermath of the depreciation that followed the Brexit referendum in 2016, UK exporters progressively shifted to invoicing most of their exports in dollars, rather than in pounds. This column shows that this dramatic transition to dollar pricing had meaningful macroeconomic consequences,...
on May 27
From cepr.org
The first national calculation of mortality of the US homeless population
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It is well established that those with lower incomes tend to have worse health outcomes. But whether this relationship extends to the most disadvantaged in society – people experiencing homelessness – has rarely been examined. This column explores the relationship between homelessness and health...
on May 26
From cepr.org
Fake news: Susceptibility, awareness, and solutions
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The proliferation of fake news poses a growing global threat, affecting politics, individual decision-making, and economic outcomes. This column discusses how informing individuals about their susceptibility to fake news affects their willingness to pay to protect themselves from misinformation....
on May 21
From cepr.org
Cool cities: The value of urban trees
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Cities are warming faster than their rural surroundings. But the ecosystem support provided by urban forestry is often omitted from climate policies due to the difficulty in assigning to it a credible monetary sum. This column estimates the value of urban trees. By exploiting an ecological...
on May 16
From cepr.org
European economic security in an age of interdependence
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COVID-19 and the subsequent supply chain congestion, the wake-up call over the dependency of Europe on Russia for energy, and geopolitical shifts and the increasingly adversarial tone of the US-China relationship have underscored the need for a comprehensive reassessment of the EU's economic...
on May 7
From cepr.org
The rise and fall of paper money in Yuan China, 1260–1368
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In early-13th century China, the Mongols introduced the silver standard, the first paper money in history to be backed by a precious metal. This column studies the rise and fall of paper money in 13-14th century China over three stages: full silver convertibility, nominal silver convertibility,...
on Apr 6
From cepr.org
The growth of the South in global finance: New bilateral data and stylised facts
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The countries of the Global South are becoming increasingly important actors in the global financial economy. This column uses a comprehensive new bilateral dataset on cross-border bank loans and deposits, portfolio investment, foreign direct investment, and international reserves, covering the...
on Mar 28
From cepr.org
Development–environment complementarity under weak institutions
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Developing countries are facing mounting pressures to incorporate environmental concerns into their policy reform agendas, leading to concerns that traditional development assistance may be crowded out. This column argues that under weak institutions, which can allow a relatively large share of...
on Mar 21
From cepr.org
Unhappy anniversary: Missed opportunities for growth and convergence in Portugal
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Portugal has failed to capitalise on the opportunities provided by EU accession and has regressed in terms of economic development over the past almost quarter of a century. This column argues that this disappointing outcome is largely down to policies biased towards current consumption instead...
on Mar 14
From cepr.org
Apple’s exclusionary app store scheme: An existential moment for the Digital Markets Act
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Article 6(4) of the Digital Markets Act (DMA), which comes into full force in the European Union on 7 March, requires Apple to permit third-party app stores to distribute apps on its iOS devices. This column reviews Apple’s scheme to comply with this requirement and argues that the proposed...
on Mar 7