Globalization – Institute for International Economic Policy (IIEP)

Trade Shocks and Supply Chains: What is Happening to the WTO and Globalization?

February 22, 2022April 11, 2022International Trade, International Trade Events, Michael O. Moore, Past Events

Tuesday, February 22nd, 2022
12:30 – 1:30 p.m. EST/6:30 – 7:30 p.m. CET
via Zoom

We were pleased to invite you to join the Insitute for International Economic Policy for a webinar featuring the Chief Economist of the WTO Bob Koopman discussing “Trade Shocks and Supply Chains: What is Happening to the WTO and Globalization?” Prof. Michael Moore moderated and IIEP Director Jay Shambaugh provided welcoming remarks. This event was in partnership with the GW Department of Economics Trade and Development Workshop organized by Yingyan Zhao and Remi Jedwab.

Since 2016 international trade has been subjected to increased geo-political uncertainty and more recently a major global health shock. How has the WTO and globalization responded? The initial Trump administration policy shocks resulted in mainly higher prices and trade diversion. The COVID-19 pandemic resulted in a number of restrictive trade policies mainly due to health policy restrictions, but also substantial fiscal and monetary policy responses in the advanced economies. The combination of economic and health policies brought about a dramatic compositional shift in demand from in-person services to tradeable goods stressing global and national supply chains. How has the global trading system responded? What role, if any, will globalization play in the future on the Phillips curve and inflation? These are important questions for the global trading system given the prospect of continued global health challenges and rising climate challenges.

About the Speaker:

Bob Koopman is currently the Chief Economist of the World Trade Organization and an Adjunct Professor of International Economics at the Graduate Institute, Geneva. At the WTO Bob serves as Chief Economic Counsellor to the Director-General, and provides the WTO Secretariat and Member Countries with analysis and information that promotes a deeper understanding of trade and trade policy’s role in economic growth and development. At the Graduate Institute Bob teaches courses on international trade. Bob also serves as the WTO representative to the G20 Trade and Investment Working Group and the G20 Framework Group. He is a research associate of CEPR, London, and an editor of the Springer Series on Advances in Applied General Equilibrium Modeling.

Prior to joining the WTO and the Graduate Institute Bob was Chief Operating Officer at the United States International Trade Commission and an Adjunct Professor of Economics at Georgetown University. Bob has also previously served as Chief Economist at the USITC, Deputy Administrator for social sciences at what is now the National Institute for Food and Agriculture, USDA, and various leadership and analyst positions at the Economic Research Service of USDA.

About the Moderator:

Michael Moore received his B.A. in liberal arts from the University of Texas at Austin and his M.S. and Ph.D. in economics from the University of Wisconsin-Madison. He is Director of the Masters of Arts in International Economic Policy program and has been a faculty member at the Elliott School since receiving his doctorate in 1988. Professor Moore teaches undergraduate and graduate courses in international trade theory and policy as well as international macroeconomics. He also has taught international economics to US diplomats at the Foreign Service Institute and students at the Fondation Nationale des Sciences Politiques (Sciences-Po) in Paris. He has published in numerous academic journals including the Journal of International Economics, International Trade Journal, Canadian Journal of Economics, Review of International Economics, European Journal of Political Economy, and Weltwirtschaftliches Archiv, and has been a contributor to five books. His commentary has appeared in numerous media outlets, including The Washington Post, The Financial Times, CNN, CBC, NPR, and NBC.

Professor Moore has served as Director of the Institute for International Economic Policy, Director of the International Trade and Investment Policy Program, and Associate Dean at the Elliott School.

Professor Moore served as Senior Economist for international trade on the President’s Council of Economic Advisors from 2002 to 2003.

Welcoming Remarks:

Jay Shambaugh is a Professor of Economics and International Affairs, and Director of the Institute for International Economic Policy at the Elliott School of International Affairs, George Washington University. His area of research is macroeconomics and international economics. He has had two stints in public service. He served as a Member of the White House Council of Economic Advisors from 2015-2017. Earlier, he served on the staff of the CEA as a Senior Economist for International Economics and then as the Chief Economist. He also spent 3 years as the Director of the Hamilton Project at the Brookings Institution. Jay is also a Faculty Research Fellow at the NBER and Non-Resident Senior Fellow in Economic Studies at Brookings. Prior to joining the faculty at George Washington, Jay taught at Georgetown and Dartmouth and was a visiting scholar at the IMF. He received his Ph.D. in economics from the University of California at Berkeley, an M.A. from the Fletcher School at Tufts, and a B.A. from Yale University.

Inequality and the Centrifugal Nature of the Labor Market

September 14, 2021March 16, 2022Development Economics, Development Economics and Poverty Alleviation Events, Past Events

Wednesday, September 29, 2021
12:00 p.m. – 1:30 p.m.
via Zoom

This was a joint Facing Inequality Series and Rethinking Capitalism & Democracy Series event featuring Peter Dietsch (University of Victoria).

Globalization and technological change are the two staple explanations of the income inequality between the relatively skilled and unskilled segments of the labor market. While recognizing their importance, this webinar turns the spotlight on another, neglected driver of income inequality. The mechanics of the labor market have a tendency to allow skilled workers to extract a significant wage premium. Arguably, the magnitude of this premium is neither just nor necessary for a functioning labor market. Interestingly, the policy response required to contain this centrifugal nature of the labor market differs markedly from the standard remedies to reduce income inequality.

Kathryn Holston (Harvard and World Bank) provided discussant remarks. This webinar was moderated by IIEP Director Jay Shambaugh with introductory remarks by IIEP Distinguished Visiting Scholar Sunil Sharma. The event was co-sponsored by GW Interdisciplinary Inequality Seminar, organized by Professor Trevor Jackson.

About the Speaker:

Peter Dietsch is a professor in the Department of Philosophy at the University of Victoria, British Columbia. His research focuses on issues of economic ethics, notably on tax justice, normative dimensions of monetary policy, and on income inequalities. Dietsch is the author of Catching Capital – The Ethics of Tax Competition (Oxford University Press, 2015), co-author of Do Central Banks Serve the People? (Polity Press, 2018), and co-editor of Global Tax Governance – What is Wrong with It and How to Fix It (ECPR Press, 2016). He has published numerous articles and book chapters, and is a regular contributor in the media on debates in his field. Dietsch received the Friedrich Wilhelm Bessel Research Award from the Humboldt Foundation in 2021 and was nominated to the College of New Scholars, Artists and Scientists of the Royal Society of Canada in 2017. Prior to the University of Victoria, Dietsch taught at the Université de Montréal for 16 years. He has been a visiting fellow at the Wissenschaftszentrum Berlin, at the European University Institute in Florence, and at the University of Victoria.

About the Discussant:

Kathryn Holston is an economist in the Office of the World Bank Chief Economist and a PhD candidate in economics at Harvard (on leave for the 2021-22 academic year). Since 2019, she has been a Stone PhD Scholar in Inequality and Wealth Concentration at Harvard. Her current work focuses on financial fragility during the COVID-19 crisis and banking crises throughout history. She is also interested in monetary policy, central bank independence and governance, and policymaking under low interest rates. Kathryn’s past work includes estimating the natural rate of interest for advanced economies with Thomas Laubach and John C. Williams, for which they received the Bhagwati Award for best paper in the Journal of International Economics. Previously, Kathryn has worked in the Monetary Studies Section of the Federal Reserve Board and as a Guaranteed Income Fellow at the Jain Family Institute. She is a graduate of the University of Pittsburgh, where she studied economics and math.

About the Moderators:

Sunil Sharma is a Distinguished Visiting Scholar at the Institute for International Economic Policy, Elliott School of International Affairs, The George Washington University, Washington, D.C., USA, and a Senior Associate at the Council on Economic Policies, Zurich, Switzerland. He was Assistant Director in the IMF’s Research Department from 2015-2018, and the Director of the IMF- Singapore Regional Training Institute (STI) in Singapore from 2006-2015. Before moving to Singapore in 2006, he was Chief of the IMF Institute’s Asian Division in Washington, D.C. Prior to joining the IMF in 1992, Dr. Sharma was on the Economics faculty at the University of California, Los Angeles (UCLA). He has a Ph.D. and M.A. in Economics from Cornell University, a M.A. from the Delhi School of Economics, and a B.A. (Honors) from St. Stephen’s College, Delhi University. His current interests include rethinking capitalism and democracy, systemic hazards, complex systems, the international financial architecture, and the institutional structure and design of financial regulation.

Jay Shambaugh is the Co-Director of the Institute for International Economic Policy and recently served as a member of the Biden transition team. His work includes analysis of the interaction of exchange rate regimes with monetary policy, capital flows, and trade flows as well as studies of international reserves holdings, country balance sheet exchange rate exposure, the cross-country impact of fiscal policy, the crisis in the euro area, and regional growth disparities. He has also served as a Member of the White House Council of Economic Advisors from 2015-2017. He also spent 3 years as the Director of the Hamilton Project at the Brookings Institution. He is also a Faculty Research Fellow at the NBER and Non-Resident Senior Fellow in Economic Studies at Brookings. Shambaugh received his Ph.D. in economics from the University of California at Berkeley, an M.A. from the Fletcher School at Tufts, and a B.A. from Yale University.

IIEP Rethinking Capitalism and Democracy Series

The COVID-19 pandemic, like the global financial crisis a decade ago, has laid bare the cracks in the leading capitalist democracies. Fissures in the political, social, economic, and financial orders, accompanied by an increasingly stressed natural environment, pose serious and possibly existential threats to these societies, as exploding income and wealth inequality subverts the integrity and fairness of markets and elections, weak regulatory oversight increases the likelihood and severity of the next crash, and the visible effects of climate change threaten lives and livelihoods and drive migrations. The three spheres of wellbeing – political and social, economic and financial, and the natural environment, are each becoming more fragile while their complex interrelationships are producing wicked challenges. The IIEP webinar series on Rethinking Capitalism and Democracy examines these difficult questions and possible policy responses.

IIEP Facing Inequality Series

The Facing Inequality series focuses on current and emerging inequality issues in the U.S. and around the globe, especially those revealed by the current COVID-19 pandemic. It brings together historians, economists, sociologists, political scientists, and epidemiologists, within the academy and without, to present work and discuss ideas that can facilitate new interdisciplinary approaches to the problem of inequality. It is a platform for dialogue and debate. This series is organized under the stewardship of IIEP Co-Director James Foster; Oliver T. Carr, Jr. Professor of International Affairs and Professor of Economics; and IIEP Faculty Affiliate Trevor Jackson, Assistant Professor of History. It is co-sponsored by the GW Interdisciplinary Inequality Series and co-organized by Professor Trevor Jackson from the Department of History and Professor Bryan Stuart from the Department of Economics.

China’s Outward Investments: State Capitalism or Capital Flight?

February 19, 2021March 19, 2022International Finance, Jay Shambaugh, Past Events, U.S.-China Economic Relations Events

Friday, March 5, 2021
9:00 a.m. – 10:30 a.m.
via Webex

Download Professor Rithmire's Slides

The Institute for International Economic Policy was pleased to invite you to the 13th annual Conference on China’s Economic Development and U.S.-China Economic Relations. The conference took place as a virtual series. The conference was co-sponsored by the Sigur Center for Asian Studies and the GW Center for International Business Education and Research.

In this event, Professor Meg Rithmire discussed the nature of China’s outward investments. Deborah Brautigam (JHU-SAIS) and Stephen Kaplan (GWU) provided discussant remarks. IIEP Co-Director Jay Shambaugh moderated the discussion.

Global observers are increasingly focused on China’s “state capitalism” and its implications for trading partners and host countries. Disentangling the strategic and commercial motives for Chinese firms abroad is not straightforward, and some of Chinese companies’ global efforts subvert, rather than execute, the Chinese state’s strategic goals. In this talk, based on research on the changing role of the state in China’s economy and the internationalization of Chinese capital over the last decade, I characterize China’s approach to globalization as a series of campaigns and experiments with constant adjustments and focus on the reach and limits of the Chinese party-state.

Meet the Presenter:

Meg Rithmire is F. Warren MacFarlan associate professor in the Business, Government, and International Economy Unit. Professor Rithmire holds a PhD in Government from Harvard University, and her primary expertise is in the comparative political economy of development with a focus on China and Asia. Her first book, Land Bargains and Chinese Capitalism (Cambridge University Press, 2015), examines the role of land politics, urban governments, and local property rights regimes in the Chinese economic reforms. A new project, for which Meg conducted fieldwork in Asia 2016-2017, investigates the relationship between capital and the state and globalization in Asia. The project focuses on a comparison of China, Malaysia, and Indonesia from the early 1980s to the present. The research has two components; first, examining how governments attempt to discipline business and when those efforts succeed and, second, how business adapts to different methods of state control.

Meet the Discussants:

Stephen B. Kaplan is an Associate Professor of Political Science and International Affairs. Professor Kaplan’s research and teaching interests focus on the frontiers of international and comparative political economy, where he specializes in the political economy of global finance and development, the rise of China in the Western Hemisphere, and Latin American politics.

A leading expert on China in Africa, Professor Brautigam is the author of Will Africa Feed China? (Oxford University Press, 2015), The Dragon’s Gift: The Real Story of China in Africa (Oxford University Press, 2010; Chinese version published by Chinese Academy of Social Sciences Press) and Chinese Aid and African Development: Exporting Green Revolution (St. Martin’s Press, 1998). She is also co-editor of Taxation and State-Building: Capacity and Consent(Cambridge University Press, 2008) as well as numerous articles published in academic journals and public affairs media. Professor Brautigam regularly advises international agencies and governments on China-Africa economic engagement.

Jay Shambaugh is a Professor of Economics and International Affairs, and Co-Director of the Institute for International Economic Policy at the George Washington University. Professor Shambaugh’s area of research is macroeconomics and international economics. His work includes analysis of the interaction of exchange rate regimes with monetary policy, capital flows, and trade flows as well as studies of international reserves holdings, country balance sheet exchange rate exposure, the cross-country impact of fiscal policy, the crisis in the euro area, and regional growth disparities.
He has had two stints in public service. He served as a Member of the White House Council of Economic Advisors from 2015-2017. Earlier, he served on the staff of the CEA as a Senior Economist for International Economics and then as the Chief Economist. He also spent 3 years as the Director of the Hamilton Project at the Brookings Institution. He is also a Faculty Research Fellow at the NBER and Non-Resident Senior Fellow in Economic Studies at Brookings.

Prior to joining the faculty at George Washington, Shambaugh taught at Georgetown and Dartmouth and was a visiting scholar at the IMF. Shambaugh received his Ph.D. in economics from the University of California at Berkeley, an M.A. from the Fletcher School at Tufts, and a B.A. from Yale University.

Are Informal Workers Benefiting from Globalization? Evidence from a Survey Experiment in India

July 15, 2020April 11, 2022Global Economic Governance Events, James Foster, Maggie Chen, Past Events, Seminar

Tuesday, August 4, 2020
12:30 pm – 2:00 pm EDT
WebEx

We were pleased to invite you to the webinar series “Facing Inequality”, hosted by the Institute for International Economic Policy. This virtual series focuses on current and emerging inequality issues in the U.S. and around the globe. The series brings attention to aspects of inequality being made increasingly relevant by the current COVID-19 pandemic and associated crises. The series is organized under the stewardship of IIEP Director James Foster, Oliver T. Carr, Jr. Professor of International Affairs and Professor of Economics, and IIEP Faculty Affiliate Trevor Jackson, Assistant Professor of History. The series is co-sponsored by the GW Interdisciplinary Inequality Series, co-organized by Prof. Jackson from the Department of History and Prof. Bryan Stuart from the Department of Economics.

The seventh event, “Are Informal Workers Benefiting from Globalization? Evidence from a Survey Experiment in India” featured Dr. Nita Rudra of Georgetown University. The discussion focused on the following: Are citizens in the developing world convinced about the benefits of globalization? By leveraging their comparative advantage in low labor costs, economists predict once-poor citizens will be better off with open markets. Yet, surprisingly little rigorous research exists on if and how workers in developing countries actually experience the benefits of increasing trade and foreign direct investment (FDI), particularly in an era of rapidly expanding global supply chains. To answer this question, we focused on the largest cluster of low-wage laborers in developing countries, informal workers, and their experience with FDI. Using observational and experimental methods, we find that both formal and informal workers in India strongly approve of foreign investment. However, the latter are deeply skeptical that the benefits of FDI will ever trickle down to themselves or their future generations. India’s much smaller population of formal workers, by contrast, are confident that they have privileged access to coveted jobs in foreign firms – regardless of skill level- and social mobility prospects will improve. These findings provide new insights on (macro and micro-level) drivers of growing global inequalities, and call for caution amongst scholars, policymakers, the international business community, and all those who anticipate that globalization is lifting all boats.

About the Moderator:

James Foster is the Oliver T. Carr, Jr. Professor of International Affairs, Professor of Economics, and Co-Director of the Institute for International Economic Policy at the George Washington University. He is also a Research Associate at the Oxford Poverty and Human Development Initiative at Oxford University. Professor Foster’s research focuses on welfare economics — using economic tools to evaluate and enhance the wellbeing of people. His work underlies many well-known social indices including the global Multidimensional Poverty Index (MPI) published annually by the UNDP in the Human Development Report, dozens of national MPIs used to guide domestic policy against poverty, the Women’s Empowerment in Agriculture Index (WEAI) at USAID, the Gross National Happiness Index of Bhutan, the Better Jobs Index of the InterAmerican Development Bank, and the Statistical Performance Index of the World Bank. Prof. Foster received his PhD in Economics from Cornell University and has a Doctorate Honoris Causa from Universidad Autónoma del Estado Hidalgo (Mexico).

About the Speaker:

Nita Rudra is a Professor of Government at Georgetown University. Her research interests include: the distributional impacts of trade and financial liberalization as they are mediated by politics and institutions; the influence of international organizations on policies in developing economies; the politics of trade agreements involving developing economies, and the causes and effects of democracy in globalizing developing nations. Her most critical works appear in the British Journal of Political Science, World Politics, Journal of Politics, American Journal of Political Science, Comparative Political Studies, International Organization and International Studies Quarterly . Her most recent book with Cambridge University Press is entitled: Democracies in Peril: Taxation and Redistribution in Globalizing Economies. Her current projects analyze how and why widespread poverty persists in rapidly globalizing economies, the politics supporting/resisting changes to the informal sector, the anti-globalization backlash, and the politics of trade and trade agreements.

About the Discussants:

Maggie Chen is Professor of Economics and International Affairs at George Washington University. She has served as Director of GW’s Institute for International Economic Policy and worked as an economist in the research department of the World Bank and a consultant for the World Bank, the International Finance Corporation, the Inter-American Development Bank, and the U.S. Congressional Budget Office. Professor Chen’s research areas include multinational firms, international trade, and regional trade agreements. Her work has been published in academic journals such as the Review of Economics and Statistics, American Economic Journal: Applied Economics, American Economic Journal: Economic Policy, Journal of International Economics, and Journal of Development Economics. She is a co-editor of Economic Inquiry and an associate editor of Economic Modeling.

Picture of Deepa Ollapally Deepa Ollapally is a political scientist specializing in Indian foreign policy, India-China relations, and Asian regional and maritime security. She is Research Professor of International Affairs and the Associate Director of the Sigur Center. She also directs the Rising Powers Initiative, a major research program that tracks and analyzes foreign policy debates in aspiring powers of Asia and Eurasia. Dr. Ollapally is currently working on a funded book, Big Power Competition for Influence in the Indian Ocean Region, which assesses the shifting patterns of geopolitical influence by major powers in the region since 2005 and the drivers of these changes. She is the author of five books including Worldviews of Aspiring Powers (Oxford, 2012) and The Politics of Extremism in South Asia (Cambridge, 2008). Her most recent books are two edited volumes, Energy Security in Asia and Eurasia (Routledge, 2017), and Nuclear Debates in Asia: The Role of Geopolitics and Domestic Processes (Rowman & Littlefield, 2016). Dr. Ollapally has received grants from the Carnegie Corporation, MacArthur Foundation, Smith Richardson Foundation, Ford Foundation, the Rockefeller Foundation, and the Asia Foundation for projects related to India and Asia. Previously, she was Associate Professor at Swarthmore College and has been a Visiting Professor at Kings College, London and at Columbia University. Dr. Ollapally also held senior positions in the policy world including the US Institute of Peace, Washington DC and the National Institute of Advanced Studies, Bangalore, India. She is a frequent commentator in the media, including appearances on CNN, BBC, CBS, Diane Rehm Show and Reuters TV. She holds a Ph.D. in Political Science from Columbia University.

Global Income Inequality: Current Developments and Their Political Implications

April 30, 2020March 28, 2022Development Economics and Poverty Alleviation Events, Economics of Ultra-Poverty Events, Past Events

Tuesday, May 5, 2020
12:30-2:00pm
WebEx

Branko Milanovic
Visiting Presidential Professor and Stone Center Senior Scholar,
The Graduate Center, CUNY;
Centennial Professor, International Inequalities Institute, LSE

We are pleased to invite you to a new webinar series, “Facing Inequality”, hosted by the Institute for International Economic Policy. This virtual series will focus on current and emerging inequality issues in the U.S. and around the globe. The series will bring attention to aspects of inequality being made increasingly relevant by the current COVID-19 pandemic and associated crises. The series is organized under the stewardship of IIEP Director James Foster, Oliver T. Carr, Jr. Professor of International Affairs and Professor of Economics, and IIEP Faculty Affiliate Trevor Jackson, Assistant Professor of History. The series is co-sponsored by the GW Interdisciplinary Inequality Series, co-organized by Prof. Jackson from the Department of History and Prof. Bryan Stuart from the Department of Economics. The inaugural event in the series will feature Branko Milanovic.

The goal of the series is to bring together historians, economists, sociologists, political scientists, and epidemiologists, both within the academy and without, to present their work and to discuss both their ideas and methods, with the intention of working towards new interdisciplinary approaches to the problem of inequality. This is a platform for dialogue and debate, and will help cultivate a community of current and future researchers and practitioners. We invite you to engage with us in this series of important discussions.

Branko Milanovic is a visiting presidential professor at The Graduate Center, CUNY, and a senior scholar at the Stone Center on Socio-economic Inequality. He is also Centennial Professor at LSE’s International Inequalities Institute. He obtained his Ph.D. in economics (1987) from the University of Belgrade with a dissertation on income inequality in Yugoslavia. He served as lead economist in the World Bank’s Research Department for almost 20 years, leaving to write his book on global income inequality, Worlds Apart (2005). His most recent book Capitalism, Alone was published in September 2019.

Milanovic’s main area of work is income inequality, in individual countries and globally, including in preindustrial societies. He has published articles in Economic Journal, Review of Economics and Statistics, Journal of Economic Literature, Journal of Development Economics, and Journal of Political Philosophy, among others. His book The Haves and the Have-nots (2011) was selected by The Globalist as the 2011 Book of the Year. Global Inequality (2016) was awarded the Bruno Kreisky Prize for the best political book of 2016 and the Hans Matthöfer Prize in 2018, and was translated into 16 languages. It addresses economic and political effects of globalization and introduces the concept of successive “Kuznets waves” of inequality. In March 2018, Milanovic was awarded (jointly with Mariana Mazzucato) the 2018 Leontief Prize for Advancing the Frontiers of Economic Knowledge.

Among his other roles, Milanovic was a senior associate at the Carnegie Endowment for International Peace in Washington (2003-2005) and has held teaching appointments at the University of Maryland (2007-2013) and at the Paul H. Nitze School of Advanced International Studies at Johns Hopkins University (1997- 2007). He was a visiting scholar at All Souls College in Oxford, and Universidad Carlos III in Madrid (2010-11).

Please RSVP to receive a link to join the webinar.

Can Globalization Be Saved?

April 3, 2019March 28, 2022Danny M. Leipziger, International Economic Policy, International Trade, Past Events

Thursday, April 11, 2019
2:15- 3:40pm

Panel of discussion and conversation between high-level senior officials in the field of globalization and economics.

Elliott School of International Affairs
Lindner Family Commons
1957 E Street NW
Washington, DC 20052

The International Monetary Fund’s World Economic Outlook

November 6, 2018March 28, 2022Development Economics and Poverty Alleviation Events, Jay Shambaugh, Past Events, Research Conference

We are delighted to invite you to the International Monetary Fund’s 2018 World Economic Outlook at the George Washington University. The talk will consist of three sections, starting with an overview of global prospects and policies and then moving onto a discussion of the global recovery 10 years after the global financial crisis and challenges for monetary policy in emerging economies.

Tuesday, November 6, 2018
9:30 a.m. – 12:30 p.m.
The Commons, 6th Floor
Elliott School of International Affairs
1957 E Street, NW
Washington, DC 20052

Schedule of Events

9:30 – 9:45 a.m. Opening Remarks

Maggie Chen, George Washington University

9:45 – 10:15 a.m. Chapter 1: Global Prospects and Policies

Presenter: Gian Maria Milesi-Ferretti, International Monetary Fund

10:15 – 10:30 a.m. Coffee Break

10:30 – 11:15 a.m. Chapter 2: The Global Recovery 10 Years after the 2008 Financial Meltdown

Presenter: Wenjie Chen, International Monetary Fund
Discussant: David Dollar, Brookings Institute

11:15 – 11:30 a.m. Coffee Break

11:30 – 12:15 p.m. Chapter 3: Challenges for Monetary Policy in Emerging Economies as Global Financial Conditions Normalize

Presenter: Rudolfs Bems, International Monetary Fund
Discussant: Jay Shambaugh, George Washington University

12:15 p.m. Concluding remarks

Chapter 1: Global Prospects and Policies

Global growth for 2018–19 is projected to remain steady at its 2017 level, but its pace is less vigorous than projected in April and it has become less balanced. Downside risks to global growth have risen in the past six months and the potential for upside surprises has receded. Global growth is projected at 3.7 percent for 2018–19—0.2 percentage point lower for both years than forecast in April. The downward revision reflects surprises that suppressed activity in early 2018 in some major advanced economies, the negative effects of the trade measures implemented or approved between April and mid-September, as well as a weaker outlook for some key emerging market and developing economies arising from country-specific factors, tighter financial conditions, geopolitical tensions, and higher oil import bills.

Chapter 2: The Global Recovery 10 Years after the 2008 Financial Meltdown

This chapter takes stock of the global economic recovery a decade after the 2008 financial crisis. Output losses after the crisis appear to be persistent, irrespective of whether a country suffered a banking crisis in 2007–08. Sluggish investment was a key channel through which these losses registered, accompanied by long-lasting capital and total factor productivity shortfalls relative to precrisis trends. Policy choices preceding the crisis and in its immediate aftermath influenced postcrisis variation in output. Underscoring the importance of macroprudential policies and effective supervision, countries with greater financial vulnerabilities in the precrisis years suffered larger output losses after the crisis. Countries with stronger precrisis fiscal positions and those with more flexible exchange rate regimes experienced smaller losses. Unprecedented and exceptional policy actions taken after the crisis helped mitigate countries’ postcrisis output losses.

Chapter 3: Challenges for Monetary Policy in Emerging Economies as Global Financial Conditions Normalize

Inflation in emerging market and developing economies since the mid-2000s has, on average, been low and stable. This chapter investigates whether these recent gains in inflation performance are sustainable as global financial conditions normalize. The findings are as follows: first, despite the overall stability, sizable heterogeneity in inflation performance and in variability of longer-term inflation expectations remains among emerging markets. Second, changes in longer-term inflation expectations are the main determinant of inflation, while external conditions play a more limited role, suggesting that domestic, not global, factors are the main contributor to the recent gains in inflation performance. Third, further improvements in the extent of anchoring of inflation expectations can significantly improve economic resilience to adverse external shocks in emerging markets. Anchoring reduces inflation persistence and limits the pass-through of currency depreciations to domestic prices, allowing monetary policy to focus more on smoothing fluctuations in output.