Global Imbalances: In Midstream?

Blanchard, Olivier; Milesi-Ferretti, Gian-Maria

doi:10.5089/9781462333387.004

Cited by 70 publications

(3 citation statements)

References 5 publications

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“…The division existing between McKinnon-Shaw's (1973) financial liberalization hypothesis /Chenery & Strout (1966) two-gap theory, globalization hypothesis, etc; and in other hand dependency theory, the Lucas paradox (1990): capital has been flowing from poor to rich countries; allocation puzzle of Feldstein-Horiorka puzzle (1980) and Gourinchas and Jeanne (2006): of failure of capital to follow growth e.g. exemplified by China's net exporter of capital with high growth rate (as cited in Beranke, 2005;Blanchard & Milesi-Ferretti, 2009;, Stiglitz financial repression hypothesis, etc exposes the deep-rooted controversies in exogenous flows (international capital movement) at the theoretical level in terms of its portent role to develop poor countries.…”

Section: Conceptual Reviewmentioning

confidence: 99%

Global Finance, Competitiveness, and Sustainable Development Goals in Emerging and Least Developing Economies (ELDCs): A Review of Literature

Onuchuku

Amaefule

2020

EUROPEAN J SUSTAINAB DEV

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This paper aims to provide a healthy review of literature on the global imperativeness of the term global finance and competitiveness to achieve Sustainable Development Goals (SDGs). We employed a content analysis method to significantly explore the impact of global finance on financing for sustainable development (FSD) through competitiveness. What are the lessons for ELDCs? From the reviewed literature, we observe that global financing causes a dual impact on competitiveness through the Real Effective Exchange Rate (REER) effects. The study found that global FSD on the informal sector, social and environmental factors, as well as human development, is unarguably silent. Also, there is the multiplicity of function in the global financing mix. From the literature reviewed, we observed a positive link between SDGs, global finance, and competitiveness. SDGs differ across countries because the financing approach on competitiveness differs across countries. Thus, to achieve SDGs in ELDCs, global responses should be developed around improving internal and external competitiveness. These two types of competitiveness would be encompassing. Global financing should be directed to exploring economic, social, and environmental quality in internal and external competitiveness in ELDCs. This classification would deepen the World Economic Forum (WEF) GCI 4.0 based on innovative, efficiency and factors element. Thus inclusive growth and sustainable development could be strengthened through the application of internal and external competitiveness policies that would holistically upgrade the industrial and manufacturing competitiveness frontiers and gains from the global market share frontiers to accelerate SDGs in ELDCs.

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Section: Conceptual Reviewmentioning

confidence: 99%

Global Finance, Competitiveness, and Sustainable Development Goals in Emerging and Least Developing Economies (ELDCs): A Review of Literature

Onuchuku

Amaefule

2020

EUROPEAN J SUSTAINAB DEV

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“…In general, the greatest attention was paid to Southern Europe and its growing wages accompanied by limited productivity growth and increased borrowing opportunities from current account surplus parts of the euro area. This fuelled sovereign debt and increased the expansionary effects of the common monetary policy (Wyplosz 2010;IMF 2009). Little or no attention was paid to the fact that after the Eastern Enlargement, the EU absorbed another periphery at its Eastern border.…”

Section: Introductionmentioning

confidence: 99%

European imbalances and shifts of global value chains to the Central European periphery: role of institutions

Sankot¹,

Hnát²

2019

Auc Geographica

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This article deals with the topic of European imbalances. They are defined as large and persistent differences in the current account position of European countries, which are closely connected to the emergence of the financial crisis and the subsequent sovereign debt crisis in 2008. A build-up in current account deficits had been observed from the mid-1990s, namely in two peripheral regions of the EU. However, little attention was paid to the potential differences between the Southern and Central European peripheries of the EU. The emergence of large and persistent current account deficits in Southern Europe was accompanied by a significant shift in gains from global value chains. The aim of this paper is to evaluate the factors that co-determined the changes in the geographic structure of GVCs in Europe. These changes decreased GVC income in Southern Europe, increased it in Central Europe and contributed to the build-up of account imbalances in Southern Europe. Despite the fact that Central Europe was among the deficit regions in European imbalances, the four Central European countries substantially increased their gains from global value chains as well as GVC participation. The shift in GVC activity towards Central Europe between 1995 and 2011 was driven not only by total labour costs but also by better regulatory quality. At the same time, TNCs switching from Southern to Central Europe had to accept worse quality contract enforcement.

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“… 10. For a detailed description of how monetary policy can be used to reduce trade imbalances, see: (Blanchard and Milesi-Ferretti, 2012; Milesi-Ferretti and Blanchard, 2009; Walter and Sen, 2008). …”

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confidence: 99%

Dealing fairly with trade imbalances in monetary unions

Meyer

2021

Politics, Philosophy & Economics

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Politicians around the globe wrangle about how to deal with trade imbalances. In the Eurozone, members running a trade deficit accuse members running a surplus of forcing them into deficit. Yet political philosophers have largely overlooked issues of justice related to trade imbalances. I address three such issues. First, what, if anything, is wrong with trade imbalances? I argue that in monetary unions, trade imbalances can lead to domination between member states. Second, who should bear the burden of rebalancing trade? I argue that surplus and deficit countries should share that burden. The current situation placing the burden squarely on deficit countries is unjust. Third, which institutional arrangements should monetary unions adopt to regulate trade balances? Monetary unions can either reduce trade imbalances within the monetary union, neutralise the impact of trade imbalances on the economic sovereignty of member states, or delegate economic policy affecting trade balances to a legitimate supranational institution. The Eurozone must adopt one of these options to prevent member states from domination. Which option protects members best against domination depends on what makes interference between members arbitrary, an unresolved question in republican theories of justice.

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Global Imbalances: In Midstream?

Cited by 70 publications

References 5 publications

Global Finance, Competitiveness, and Sustainable Development Goals in Emerging and Least Developing Economies (ELDCs): A Review of Literature

Global Finance, Competitiveness, and Sustainable Development Goals in Emerging and Least Developing Economies (ELDCs): A Review of Literature

European imbalances and shifts of global value chains to the Central European periphery: role of institutions

Dealing fairly with trade imbalances in monetary unions

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