Japan Stands Up


By Jerry Schiff

(Version in  日本語)

As a Japanese proverb has it: “Knocked down seven times, get up eight.”

In a display of its resilience, Japan is getting up once again after the devastating earthquake and tsunami of a year ago.  But the world’s third largest economy still faces multiple challenges, and in our latest assessment of the country’s economy, the Japanese mission team at the International Monetary Fund has proposed a range of mutually reinforcing policies to strengthen confidence, raise growth and help restore Japan’s economic vitality.

A year and four months ago, Japan was reeling from the Great East Japan earthquake and accompanying devastation.  As well as the tragic loss of life, the economy was badly shaken.  Supply chain disruptions brought production in parts of Japan to a virtual halt. Yet, since then, the country has shown its resilience, with reconstruction contributing to strong first quarter growth of 4¾ percent.

But despite this hopeful sign, all is not well.

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Can Policymakers Stem Rising Income Inequality?


By David Coady and Sanjeev Gupta

The issue of rising income inequality is now at the forefront of public debate. There is growing concern as to the economic and social consequences of the steady, and often sharp, increase in the share of income captured by higher income groups.

While much of the discussion focuses on the factors driving the rise in inequality—including globalization, labor market reforms, and technological changes that favor higher-skilled workers—a more pressing issue is what can be done about it.

In our recent study we find that public spending and taxation policies have had, and are likely to continue to have, a crucial impact on income inequality in both advanced and developing economies.

In advanced economies, this is especially important given that the ongoing fiscal adjustment needs to be continued for many years to reduce public debt to sustainable levels. But it is equally important in developing economies where inequality is relatively high.

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Economics – New Links for Students from the IMF


The IMF’s well written Finance & Development magazine has recently published two helpful online compilations of articles that may be useful to students and those interested in economic issues.    They are rich collections of material that are totally free!!
1. Back to Basics — explaining some fundamental concepts in Economics and Finance
2. People in Economics — a collection of profiles of leading economists and policymakers, including 10 Nobel Prize winners.
In addition,
  • listen to regular audio podcasts with leading experts on development issues around the world–or download from iTunes.
  • and get free a neat new ipad app for IMF news and data–it lets you chart and view global economic indicators and forecasts

Youth Speaking Out


CliftJBy Jeremy Clift

Young people, hardest hit by the global economic downturn, are speaking out and demanding change. Coming of age in the Great Recession, the world’s youth face an uncertain future, with lengthening job lines, diminished opportunities, and bleaker prospects that are taking a heavy emotional toll.

Some people call them the iPod generation—insecure, pressured, overtaxed, and debt-ridden—but insecure or not, around the world young people are challenging a system that appears to have let many down. “Young people want a world economy that is more just, more equal, and more human,” says Angel Gurría, secretary-general of the Organization for Economic Cooperation and Development.

Differing impact on generations

Youth Demanding Change

The Great Recession has taken its toll on the different generations in different ways. For the post–World War II baby boom generation, it’s essentially a wealth crisis. A generation that had hoped to retire has seen the value of its property and savings dramatically eroded. For the group known as Gen X (born 1965–80), it’s an income crisis. They should be in the period of their life when they are earning the most, but the downturn has depressed their salaries and threatens their pensions. For Gen Y (1981–2000), it’s about their future and the potentially damaging legacy of the boomer generation.

In recent issues of the magazine, we have looked at the impact of aging populations on economies around the world and how inequality affects growth.

In the March 2012 issue of F&D, we look at the need to urgently address the challenges facing youth and create opportunities for them. Watch a video on this.

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Weak Global Economy Tops Agenda at IMF-World Bank Gathering


By iMFdirect

Recent turbulence in financial markets and increased risks in the global economy mean that the 2011 Annual Meetings of the IMF and World Bank are taking place at a critical time for the global economy.

Economic leaders will come together to assess the state of the world economy and discuss the policy actions needed to deal with today’s global economic challenges. The IMF’s updated forecast for the world economy will be published September 20.

About 10,000 policymakers, private sector and civil society representatives, journalists, and academics are expected to attend the Annual Meetings, which are set to take place on September 23–24.

In an interview, Reza Moghadam, Director of the IMF’s Strategy, Policy, and Review Department, discusses the issues that are likely to receive most attention at the meetings. Continue reading

Global Challenges, Global Solutions


By iMFdirect

The IMF-World Bank Spring Meetings are upon us here in Washington DC.

With global challenges that require global solutions—the theme of the meetings—IMF Managing Director Dominique Strauss-Kahn reminds us that this is “not the time for complacency.”

Government ministers and officials, members of civil society organizations, journalists, and others are flocking to Washington DC this week to discuss and decide on key issues facing the global economy. Continue reading

Today’s Bounty, Tomorrow’s Promise: Better Policies to Manage Natural Resources


By Leslie Lipschitz

(Version in Español | Français | عربي )

Countries rich in natural resources are often looked at with envy: they face few financial constraints and that should speed their development path. But the reality is less rosy.
Countries with an abundance of natural resources—typically oil, gas or minerals—have, on average, performed less well than comparable non-resource rich countries.

That raises one of the perennial questions in economic policymaking. How to manage the economic and social challenges that stem from resource wealth? Or, to borrow the words of Professor Thorvaldur Gylfason (University of Iceland), how to prevent “nature’s bounty” from “becoming the curse of the common people”? Continue reading

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