News and Analysis: 1-15 Sep 2014 | EmergingFrontierMarkets.com

Based in: Manila, Philippines

Posted on Mon, 15 Sep 14:

Howard Shatz: How ISIS funds its reign of terror, New York Daily News, 8 Sep 14 [courtesy Rand Corp]:
Despite rumors, there is little evidence that ISIS ever depended on foreign largess. It raises much of its money just as a well-organized criminal gang would do. It smuggles, it extorts, it skims, it fences, it kidnaps and it shakes down. To borrow from a mobster, its members don't get ahead just by being thugs--"at some point you have to learn to be a racketeer too," writes Rand senior economist

Abhijit Banerjee: The new planning body must have a certain oomph, Hindustan Times, 19 Aug 14 [PDF, courtesy MIT]:
Call me sentimental. The 1st time I went to the Planning Commission was when it was under KC Pant, a long time ago. I see the reasons why the gov't wants it gone. A lot has changed since 1950: We are liberalized now, placing our faith in the wisdom of the market over that of the State, writes MIT prof / co-recipient, with MIT's Ester Duflo, of the 2014 Albert O. Hirschman Prize

K Rogoff: Paper money is unfit for a world of high crime and low inflation, FT, 28 May 14 [PDF, courtesy Harvard]:
Has the time come to consider phasing out anonymous paper currency, starting with large denomination notes? Getting rid of physical currency and replacing it with electronic money would kill two birds with one stone, writes fmr IMF chief economist / recipient of the 2011 Deutsche Bank Prize in financial economics

Posted on Fri, 12 Sep 14:

New 'creative productivity index' to help foster innovation in Asia, Asian Dev't Bank, 12 Sep 14:
A new creative productivity index developed by the Bank and Economist Intelligence Unit ranks Japan and SKorea as nations most efficient in Asia-Pacific at turning creative inputs into tangible innovation. The index differs from existing innovation-related indices by focusing on how efficiently nations turn their creative inputs into innovation outputs rather than just the absolute level of inputs

Martin Wolf: Shaping globalization, Finance & Development, Sep/Nov '14:
Globalization is the big story of our era. Many assume it is also, for good or ill, an unstoppable force. History, however, suggests this is not so. We can neither assume globalization will persist, nor that it will be desirable in all respects. But one thing we must assume: it is ours collectively to shape, writes Financial Times chief econ commentator

Danny Quah: It is not easy being leader of the world, Global Policy Journal (blog), 30 July 14:
Some days it's just plain stressful when the world keeps looking to you to solve its problems, to be global hegemon. By 'hegemon' I mean not evil imperialistic power, but instead what historians mean from their study of the Delian League in Ancient Greece: 'benevolent leader'. The problem is, world leadership demands high standards. Soft power is hard to earn but easy to lose, writes London Sch Econ prof

Posted on Thu, 11 Sep 14:

Howard Shatz: To defeat the Islamic State, follow the money, Politico, 10 Sep 14 [courtesy Rand Corp]:
If Pres Obama wants to defeat the jihadis, he will need more than airstrikes. For all that ideology, religious belief and perhaps a lust for violence and power might motivate those who fight for the Islamic State (aka ISIS and ISIL), money is what keeps the group going. Even for the world's richest terrorist org -- which ISIL is -- money doesn't grow on trees, writes Rand senior economist

'World economic growth is too weak to create jobs' - IMF's Lagarde, Les Echos, 8 Sep 14 [Tr. from French by IMF]:
Q&A with IMF's managing dir: With one month to go until the IMF Annual Meetings, what is your outlook on global growth?; Is the risk to growth primarily a geopolitical one?; The IMF's governance reform, which would more effectively integrate emerging market economies, continues to be rejected by the US Congress. How do you expect to break this deadlock?

Coffee/Tea Room: Chang and assoc -- Flickonomics: Eight movies that teach us how money works, Guardian, 15 July 14:
From 'The Full Monty' to 'The Matrix', films have a lot to say on economics. 'Mary Poppins' teaches us that banking is about confidence, and 'Some Like it Hot' lays bare the trouble with capitalism, write Cambridge U prof and associates

Posted on Mon, 8 Sep 14:

Olivier Blanchard: Where danger lurks, Finance & Development, Sep/Nov '14:
Until the 2008 global financial crisis, mainstream US macroeconomics had taken an increasingly benign view of economic fluctuations in output and employment. The crisis has made it clear that this view was wrong and that there is a need for a deep reassessment. It has taught us to pay attention to dark corners, where the economy can malfunction badly, writes IMF chief economist, on leave from MIT

What is the relationship between Chinese politics and IPOs?, Stanford Univ, 3 Sep 14:
Chinese companies are going public in a big way. Alibaba, already the world's biggest online retailer, is expected to hold this month what may well be the biggest initial public offering yet. But evaluating Chinese public offerings takes more than scrutinizing the numbers. Politicians and political connections have such a big impact on a company's operations and prospects

Breaking through - How the Trans-Pacific Partnership could reshape the global economy, Milken Inst, July/Sep '14 [PDF]:
Even now, six years after the US entered the trade negotiating fray, it's likely that more Americans speak Urdu than have heard of the Trans-Pacific Partnership (TPP). The trade deal has floated for years in the realm of wonk-speak. And yet the TPP is the most ambitious trade agreement the US has ever negotiated, in the fastest-growing region of the world

Posted on Fri, 5 Sep 14:

Time to tax carbon, Harvard Magazine, by J Shaw, Sep/Oct '14:
Next year, delegates from nations around the world will meet in Paris to discuss a global climate-change agreement. A central topic of discussion will be the social costs of releasing greenhouse gases into the atmosphere. As the date nears, the work of economist Dale Jorgenson on a plan for controlling greenhouse gases while enhancing economic growth is especially important

What do the 2,400 people who work for the IMF actually do?, WSJ, by D Wessel, 20 Aug 14 [courtesy Brookings Inst]:
Let's face it. This is a question that most people have never asked, but sometimes the best reads are answers to questions you never thought to ask. Liaquat Ahamed, author of the award-winning Lords of Finance, answers this question with style and insight in a On Tour with the IMF. He essentially embedded with the IMF staff and offers a snapshot, writes Inst Hutchings Ctr dir

Adam Posen: The errors of conservatives obscure the case for trade, FT, 22 July 14 [courtesy Peterson Inst]:
Twenty years after fmr US Pres Bill Clinton signed the North American Free Trade Agreement (NAFTA), its very name chills the spines of US voters and congressmen alike. Even advocates of new regional trade agreements insist that they are not countenancing "another NAFTA". Yet NAFTA-phobia is irrational, writes Inst pres

Posted on Wed, 3 Sep 14:

Switzerland remains on top of global competitiveness rankings, World Economic Forum, 3 Sep 14:
At the top of the latest rankings are Switzerland, Singapore, US, Finland, and Germany. The leading economies all possess a track record in developing, accessing and utilizing available talent, as well as in making investments that boost innovation. This is made possible by a coordinated approach based on strong collaboration between the public and private sectors (Country rankings) [PDF]

Edmund Phelps: Teaching economic dynamism, Project Syndicate, 2 Sep 14:
Biz leaders often argue that the widening gap between what young people learn and the skills that the job market demands is a leading contributor to high unemployment and slow growth. Govts seem convinced that the best way to close the gap is to increase the number of students in the STEM subjects (science, technology, engineering, and math). Are they right?, asks Nobel Laureate '06 / Columbia U prof

Path breaker -- Nobel Laureate Kenneth Arrow, Finance & Development, by J Stotsky, Sep/Nov '14:
The late econ theorist Frank Hahn, alluding to Shakespeare's description of Julius Caesar, once said that Arrow " 'bestrides the world like a colossus'. . .There is hardly any area of our subject which he has not illuminated," demonstrated perhaps by the disparate concepts with his name attached--such as the Arrow-Debreu model, the Arrow impossibility theorem, and Arrow securities

Posted on Mon, 1 Sep 14:

Edward Lazear: Job turnover data show lots of churning, little job creation, Investor's Business Daily, 19 Aug 14:
Reductions in employment during recessions come about primarily because the hiring rate declines, not because layoffs pick up. It is easy to cut employment to recession levels simply by a freeze in hiring for a month or two. It is the number of hires that tells us how close we are to getting back to pre-recession level, writes Pres G W Bush's Council Econ Advisers chair / Stanford prof

Foreign students strengthen the US economy, World Bank (blog), by N Ruiz, 29 Aug 14:
Increasingly, US colleges and universities are educating the world's business, scientific and political leaders of the future. Between '08 and '12, China, India, SKorea and Saudi Arabia sent the most foreign students to the US to study. A new Brookings report says that metropolitan leaders need to capitalize on their connections to fast-growing foreign markets where these students come from

Will China's currency ever rival the dollar?, Top of Mind (Goldman Sachs), May '14 [PDF, courtesy Prasad's site]:
Q&A with Eswar Prasad, author of The Dollar Trap (2014) and Cornell U prof: What is the role of the Chinese Renminbi (RMB) in the global monetary system?; how long will it take for the RMB to become a reserve currency?; will the RMB ever become a 'safe haven' currency?; and what motivated the recent shifts in China's exchange rate policy?

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