Articles
Articles and analyses from the INET community on the key economic questions of our time.
When Is the Time for Austerity?
Recent austerity policies have been guided by ideology rather than research. This column discusses research that reconciles disparate estimates of fiscal multipliers in the literature. It finds that common identification assumptions are problematic. Matching methods based on propensity scores show how contractionary austerity really is, especially in economies operating below potential.
Should China Deregulate Finance?
Thirteen Ways to Split a Cake*
Axiomatic bargaining is presented in MWG in the context of welfare economics (Ch. 22), the aim being the formulation of reasonable criteria for dividing gains resulting from cooperative endeavors (the “joint surplus”). It is further presented as an application of cooperative game theory, in which an arbitrator distributes the joint surplus in a manner that reflects “fairly” the bargaining strength of the different agents (although we could conceive of a situation where the parties are bargaining without an external party). If bargaining fails, the outcome is the parties’ own fallback positions (the threat point, or status quo).
The Entrepreneurial State: Debunking Public vs. Private Sector Myths
is the public sector really sclerotic and conservative in contrast with a dynamic and innovative private sector?