The US has some legitimate concerns about some trading partners, but the way it’s going about trade negotiations is deeply flawed. Large parts of the US trade team seems blissfully unaware of basic facts or the elementary determinants of trade flows and balances. It’s difficult for negotiating partners to deal with that and the fallout […]
Entries Tagged as 'Economic Policy'
June 19th, 2018 · Comments Off on Countries Are Not Companies
Tags: Economic Policy
April 18th, 2018 · Comments Off on Another Own Goal?
The trade tensions between the US and China are heating up. Much of the US focus is on Chinese efforts to expand in high-tech industries in general and optical networking industries in particular. Hence, the US is putting sand in the wheels of the expansion of important Chinese companies like ZTE and Huawei. But these […]
April 11th, 2018 · Comments Off on The U.S.-China Race To Lead The Fourth Industrial Revolution
The US Administration has reacted with alarm about China’s (2015) ambitious plan to develop industries of the future (China 2025). It is threatening China with trade sanctions, mostly targeted at thwarting, or at least slowing down these Chinese ambitions. But these Chinese ambitions aren’t anything out of the ordinary. They follow logically from their economic […]
Tags: Economic Policy
December 26th, 2017 · Comments Off on An Unexpected Tax Cut Bonanza
The Trump tax cut could produce more economic stimulus than many economists (ourselves included) expected. This could occur if others copy the example of several big corporations that announced they will share their tax bonanza with employees. Given the increasing gap between employee compensation and productivity growth, it’s about time, as such a model isn’t […]
November 27th, 2017 · Comments Off on What China Can Teach Us About Economic Growth
After the enactment of US tax cuts supposedly comes infrastructure spending. As experiences go, the latter is likely to be a bigger booster for economic growth. While the US economy actually doesn’t need any kind of stimulus right now, it does need better infrastructure. These plans would have been much better half a decade ago […]
June 2nd, 2017 · Comments Off on Only The White Heat Of Technology Can Revive Growth
US growth his hitting constraints from labor productivity and labor force growth. Big tax cuts will do little to solve these constraints. The US could do much better by embracing the artificial intelligence revolution, and it is already well placed to benefit from this. But the dislocation of labor AI will produce could very well […]
April 29th, 2017 · Comments Off on Will Trump Be The Next Ronald Reagan?
Can Trump do a Reagan? We have to wait for further details of his tax plan and see what survives Congress. However, we have to point out that there are some important historical differences which makes a repeat of the Reagan years much less likely. And this is even if you believe that tax cuts […]
April 29th, 2017 · Comments Off on The Limits Of Free Money
Investors have been much more savvy about how economies behave under excess savings than many policy makers and observers. While investors piled on and made a killing, many policy makers have overly worried about the risks of accelerating inflation and the state of public finances. That doesn’t mean the near free money that a savings […]
April 29th, 2017 · Comments Off on Boom Time For Liberals
The existence of excess savings over investment produces an economy that works differently. It basically enables the public sector to increase spending for free. This is most visible in the deleveraging stage after the burst of an asset bubble, where policy vice becomes virtue and public releveraging needs to compensate private deleveraging. But some of […]
April 6th, 2017 · Comments Off on A Curious Economic Riddle
From most of its economic data post financial crisis one would be inclined to think Belgium is a peripheral Southern European eurozone economy. The Dutch economy on the other hand is one of the most competitive in the world. Yet for most of the post-financial crisis period, the Belgium economy performed considerably better on growth, […]