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The latest news, debates, proposals and developments on new economic thinking at a glance.
In the study, the two examine various strands and arguments – philosophical, empirical, as well as policy-prescriptive – around the growth debate and frame them in terms of the central question of the limits to growth. The study concludes that the contemporary debate is best understood as a disagreement between political strategies, in which the character of public and academic discourse plays a key role.
The key ideas were also recently summarized in a Project Syndicate article. The article can be accessed here.
The full study is available here.
The two political scientists assess the effects of the tax reductions for top incomes in OECD countries from 60 percent on average in the 1980s to around 40 percent today. They find no significant growth effects of tax cuts. However, they have increased inequality substantially. You find the study here.
When?
16.05.22 6 p.m.
Where?
Click here to register.
The event will address the following questions, among others:
What would be the economic consequences of an energy embargo against Russia? This question is the subject of controversial public debate. Chancellor Scholz does not want to rely on abstract mathematical models, others have more confidence in scientific calculations. How reliably can economic models depict the economic consequences of an energy embargo in Germany? What model approaches are available? Why do some of the findings differ so significantly? What can economic policy advice actually achieve here and how can it be improved?
When?
13.05.22 4 PM
Where?
Hier geht es zur Anmeldung.
The goal of the Symposium is to stimulate a thought-provoking debate on the topic of climate change and its implications for the macroeconomy. The Symposium will bring together both academics and policymakers to discuss four key topics:
1) Climate change and monetary policy
2) Redistribution of labour and capital due to climate change
3) Climate change, trade and global production
4) Climate uncertainty, financial markets and the natural rate of interest.
Who is conducting our Monetary Policy? – Audio clip (German)
Michael Peters WDR 5 Interview, 06.05.2022
Due to high inflation, the US Federal Reserve has raised the key interest rate. This affects many areas of daily life. But the central banks are hardly structured democratically, says Michael Peters of the citizens’ movement Finanzwende e.V.
What the 2030 climate goals mean for fiscal policy – Study (German)
Maximilian Kellner et al., Ariadne-Projekt, 06.05.2022
Climate policy measures cost money, but are also associated with high revenues – for example through CO2 pricing in emissions trading. By 2030, these revenues from the national and Germany’s share of European emissions trading could total €178 billion, and even €302 billion if CO2 prices rise more strongly, new Ariadne calculations show. At the same time, the total need for public climate investment is estimated at up to €616 billion, especially if CO2 prices do not rise sufficiently.
Europe lacks a functioning infrastructure for the political participation of its citizens – Study
Dominik Hierlemann, Stefan Roch, 05.05.2022
A new study “Under Construction: Citizen Participation in the EU” shows that the EU has numerous instruments for citizen participation in place. However, the general public is not well aware of these mechanisms, and their impact is often quite limited. The individual instruments do not add up to a visible, comprehensive and effective participation infrastructure in Europe. Citizen participation in European decision-making processes consequently takes place via a patchwork of participatory instruments. The study recommends five ways of constructing a better participation infrastructure.
The failure that is not: Marine Le Pen in the 2022 presidential election – Blogpost (German)
Sylvie Strudel, Heinrich-Böll-Stiftung, 03.05.2022
For the second time, Marine Le Pen has failed in the decisive run-off election against Emmanuel Macron. With 41.5%, she lost to the old and new incumbent. But can one really speak of failure?
A populist game with fire – Article (German)
David Barkhausen, Makronom, 03.05.2022
In view of the high inflation rates, the pressure on monetary policy to take aggressive steps is growing. However, prosperity, the economy and consumers could suffer even more from this than from temporarily rising prices.
Central banks must embrace systemic reforms to avert the biodiversity crisis – Blogpost
Katie Kedward and Josh Ryan-Collins, IIPP Blog
Last month the Network for Greening the Financial System (NGFS), a group of over 100 central banks and financial supervisors, in collaboration with the independent research network INSPIRE, published a landmark report examining the links between biodiversity loss and economic and financial risks. The report argues that biodiversity loss poses systemic risks in the same way as climate change and calls for a concerted response by central banks and financial supervisors.
OUR MAIN TOPICS
New Paradigm
NEW PARADIGM
After decades of overly naive market belief, we urgently need new answers to the great challenges of our time. More so, we need a whole new paradigm to guide us. We collect everything about the people and the community who are dealing with the question of a new paradigm and who analyze the historical and present impact of paradigms and narratives – whether in new contributions, performances, books and events.
Redefining
the role of
the state
REDEFINING
THE ROLE OF
THE STATE
For decades, there was a consensus that reducing the role of the state and cutting public debt would generate wealth. This contributed to a chronic underinvestment in education and public infrastructure. New research focuses on establishing when and how governments need to intervene to better contribute to long-term prosperity and to stabilize rather than aggravate economic fluctuations.
Remaking
finance
REMAKING
FINANCE
More than a decade after the financial crisis there still seems to be something seriously wrong with the financial system. Financial markets still tend to periodically misprice risk and contribute to boom and bust cycles. A better financial system needs to discourage short-termism and speculative activity, curtail systemic risk and distribute wealth more broadly.
Greening
prosperity
GREENING
PROSPERITY
During the high point of market orthodoxy, economists argued that the most 'efficient' way to combat climate change was to simply let markets determine the price of carbon emissions. Today, there is a growing consensus that prices need to be regulated and that a carbon price on its own might not be enough.
Reducing
inequality
REDUCING
INEQUALITY
The rising gap between rich and poor has become a threat to social cohesion in most rich countries. To reverse this trend it will be crucial to better understand the importance of different drivers of income and wealth inequality.
Innovation Lab
INNOVATION LAB
Do we need a whole new understanding of economic growth? What would be a real alternative? How viable are alternatives to GDP when it comes to measuring prosperity? These and other more fundamental challenges are what this section is about.
Globalization
for all
GLOBALIZATION
FOR ALL
After three decades of poorly managed integration, globalization is threatened by social discontent and the rise of populist forces. A new paradigm will need better ways not only to compensate the groups that have lost, but to distribute the gains more broadly from the start.
Europe
beyond markets
EUROPE
BEYOND MARKETS
The euro was planned during a period in which economic policy making was driven by a deep belief in market liberalism and the near impossibility of systemic financial crises. This belief has been brought into question since the euro crisis, which showed that panics do happen. New thinking needs to focus on developing mechanisms to protect eurozone countries from such panics and to foster economic convergence between members.