On May 6 Malaysia re-elected its ruling coalition government, the National Front, to another five-year term after vociferous campaigning and debate on the issue of corruption. This three-part series looks at whether the election’s attention on corruption will produce results.… Continue Reading
On May 6, Malaysia re-elected its ruling coalition government, the National Front, to another five-year term after vociferous campaigning and debate on the issue of corruption. In the first of a three-part series looking at whether the election’s attention on… Continue Reading
You can stop worrying that the euro is on the verge of extinction. The new worry in Europe is that it may instead be too strong. But the ability of European leaders to remain calm will determine whether we in… Continue Reading
The Mint newspaper, India’s Wall Street Journal affiliate, published a piece by Russell Green, the institute’s Will Clayton Fellow in International Economics, today on India’s directed lending program. Since the 1970s India has set a mandatory target for its domestic banks to lend to certain “priority sectors” including agriculture and small and medium-sized enterprises. The targets have become more ambitious over time, despite slow growth in the agriculture sector. Banks now struggle to meet the targets without jeopardizing their own standards for lending quality. Green criticizes the recent expansion of agricultural lending targets to foreign banks, and suggests ways the program could be improved. Continue Reading
This blog presents preliminary estimates of the economic effects of a base-broadening, rate-reducing tax reform, similar to that outlined in the paper noted above, using the Tax Policy Advisers model — a model developed by John Diamond, the Baker Institute Edward A. and Hermena Hancock Kelly Fellow in Public Finance, and George Zodrow. The simulations show that such a base-broadening, rate-reducing reform would have significant positive economic effects on the U.S. economy, including increases in investment, the capital stock, employment, and real wages. Specifically, I find that the reform would, if passed immediately, increase GDP relative to the baseline by 5.0 percent over the next decade, while creating 5.9 million jobs. Continue Reading
India primarily relies on coal to generate electricity, and is struggling to provide enough power to light its homes and power its industry. Russell Green, Will Clayton Fellow in International Economics, writes in The Wall Street Journal that although state-run miner Coal India has increased production in the past five years, it has also entered into fuel supply agreements with private sector electricity producers and will “be forced to import massively” to meet demand. Continue Reading
Adding political mayhem to economic instability, Greece has dominated the news once again in recent weeks. The only positive thing is that Greek democratic institutions appear to be working well, and they have not been threatened by the crisis. As a result, Greece’s fate will be decided by the majority of its citizens. Continue Reading