Migration is one of the most contentious and relevant issues of our time, as evidenced by the increasing numbers of migrants and displaced persons and by inflammatory political discourse throughout the world. This paper discusses the underlying causes of recent migration flows and “crises,” such as the civilian-centered nature of recent conflicts, persistent underdevelopment, climate change, and political impasse that prevents conflict resolution and adequate management of migration flows. Further, the paper focuses on policy reforms to (i) tackle the root causes of migration and (ii) minimize the costs and maximize the benefits (both social and economic) associated with migration. Such policies include a pan-European approach to relocation to ease the burden on EU border countries, increasing legal avenues for migration in the US, and integration policies to preserve social cohesion. Taking a long-term view, the paper aims to present a balanced view of the challenges of migration and to summarize policy reforms anchored upon recognition of the extensive human costs – and unrealized benefits of – one of the most defining issues of our era.
Humans are exploiting the Earth’s natural resources at a rate which cannot sustain global economic growth in the long-term. In the last decade environmental economists, most multilateral institutions, and many national governments have announced their support for a transition to a more efficient market-friendly manner of conducting global economic affairs, a green economy. The International Chamber of Commerce defines the green economy as “an economy in which economic growth and environmental responsibility work together in a mutually reinforcing fashion while supporting progress on social development.”1 This paper offers an overview of what makes a “green economy,” proposes policies which can help achieve that model and analyzes the potential effects of a green transition on communities vulnerable to this economic change.
Islamic economics (IE) provides an alternative economic model to today’s Western system. Interest in this newfound field stems from its success in remaining relatively unaffected after the 2008 financial crisis. Proponents include financiers interested in attracting new business from a growing portion of the population and Islamic scholars hoping to utilize it as a tool in Muslim identity. Competing interests from these differing sectors of society has led the original intention of IE astray. But does it matter if IE is simply a reworked form of Western financial products and its framework guised under another name? This paper examines a brief history of IE followed by an analysis of its theory, goals, and operations. Finally, a comparison of implementation in three Islamic states highlights the challenges of IE and Islamic finance, and concludes with a short summary of IE’s potential legacy.
Dr. Catherine L. Mann has been OECD Chief Economist, G20 Finance Deputy, and Head of the Economics Department since October 2014. Dr. Mann is responsible for advancing the Strategic Orientations of the OECD, including the OECD’s Economic Outlook, country-based economic surveys and the Going for Growth report. She was most recently a Professor of Global Finance at the International Business School at Brandeis University and Director of the Rosenberg Institute of International Finance.
Prior to the 1986 Maxi Trials, relatively little was known about the Sicilian Cosa Nostra. Its omertà, or code of honor, had held strong. But the success of the trials was only possible through the testimony of pentiti, or turncoats, at the expense of the code of honor. What caused this breakdown? As the organization became increasingly globalized, the older bonds of trust and honor that originally defined the omertà became weaker, facilitating the conditions for defection. The effects of globalization are visible in five areas: profit-making opportunities, organizational structure, the code of honor, political ties, and the anti-mafia movement. The Cosa Nostra’s continued existence today has implications for perceptions of the Italian government's legitimacy.
This paper focuses on the consequences of financial liberalisation and monetary integration on the two largest economies of Southern Europe, Italy and Spain. As part of the European project of financial liberalisation that was pushed forward with the 1992 agenda and the introduction of the single currency in 1999, these economies found themselves facing new challenges in economic policy-making. Given the dismal economic performance in recent years of the so-called Southern ‘periphery’ unveiled by the financial crisis in 2008, the aim of this case study is to understand why the benefits of liberalised financial systems and monetary union did not fully materialise. By showing how European financial and monetary integration provoked large-scale capital inflows, which led to distortions that were difficult for policymakers to control in Italy and Spain, the paper challenges the dominant narrative that the profligacy of Southern governments was simply to blame for the crisis.
There is no definitive answer as to the impact on a country’s macroeconomic indicators of joining the Eurozone. There is little impact on a country’s trade dependence. Peripheral countries suffered in terms of unemployment, but weakly gained in terms of incomes. However, no doomsday image emerges. While this appears to limit the short-term economic upside of the currency union project, it brings into the forefront the Eurozone’s aforementioned political considerations: eliminating competitive devaluations, having a common European monetary voice and tightening economic and political bonds within Europe. If this appeals to a prospective Eurozone member, they should not hold back for economic fears.
More than a decade since the vicious battle between Gucci and Bernard Arnault’s Louis Vuitton Moët Hennessy, this case remains an important case study in the failure of smart men to make measured choices. What led such wise men to fall prey to multiple mistakes and ultimately to the disintegration of negotiations? The work of the Harvard Negotiation Project and Robert Axelrod help elucidate the areas in which the characters involved could have acted differently. The consequences of the case highlighted the new interconnectedness of global financial and corporate markets. Today, luxury goods conglomerates cite this case as one of the most important in the history of fashion.
A consideration of NASA's asteroid observation mission highlights the possibility that for rare events observation is not unambiguously positive. Although measurement is beneficial in the long run, and is required for eventual risk management or mitigation, it may at first actually increase the expected value of the risk. In the case of the asteroid mission, observation created a substantial risk of false positives that greatly outweighed the initial potential risk reduction from early warning or asteroid diversion, such that the total risk increased. These dynamics are explored with a simple model that can be extrapolated to improve the risk calculation for any rare threat.
Ventures selling distributed electricity directly to impoverished consumers achieve affordability by minimizing up-front prices and collecting post-sale revenue. Through interviews with 30 practicing entrepreneurs operating at the base of the pyramid (BoP), we evaluate two pricing methods, micro-finance and pay-as-you-go, that accomplish this task. Each of these methods has implications for other aspects of the venture’s business model. With further research, these models might be adapted to other undeveloped sectors around the world that also lack infrastructure and competition.
This article explores the rationale behind the 315 billion euro spending program of the European Union called the ‘Juncker Plan,’ and expands upon the analytical framework of McNamara in her 1998 book, "The currency of ideas." Policy elites believed that, at the member state level, Keynesian counter-cyclical fiscal expansion was an ineffective policy tool. This led directly to the creation of new budget rules for European Union member states under the European Semester and the Macroeconomic Imbalance Procedure (MIP). The Juncker plan is the product of the constraining institutions created before the shift towards Keynesian demand management -- which makes an expansionary fiscal policy at the Union level the logical path out of the crisis.
We are proud to introduce our readers to SAIS Europe’s new director with this interview. Michael Plummer, himself a 1982 SAIS graduate, has been the Eni Chair of International Economics at SAIS since 2008 and has taken on the role of SAIS Europe director as the Bologna campus marks its 60th anniversary this year. He is a distinguished economist, who has served as the head of the development division of the Organization for Economic Cooperation and Development (OECD) and editor-in-chief of the Journal of Asian Economics. Prior to SAIS, Plummer was an associate professor at Brandeis University, also serving as the Director of M.A. programs at the university’s Graduate School of International Economics and Finance, now known as the International Business School. (Interview transcript has been condensed and edited for publication)
The academic debate on whether world income inequality is rising or falling has reached a stalemate: parties are unable to agree on the analysis of these economic world trends. This commentary examines recent research that supports the opposing “convergence” and “divergence” camps to examine the origins of the debate, and to determine why consensus is so difficult to reach. While this analysis concludes that the main driver of disagreement is calculation methods and data, that conclusion poses a key question: Is studying world income inequality useful?
Is the legal maxim of “justice delayed is justice denied,” frequently leveled against the International Criminal Court for its poor track record, an accurate description of the current situation in Darfur? Or, on the contrary, could the imperative of immediate justice, so often heralded as the sine qua non of a durable reconciliation, be temporarily suspended in the interest of peace? With these questions in mind, will explore what impact a temporary deferral of the International Criminal Court’s (ICC) arrest warrant against Sudanese President Omar al-Bashir might have, and whether this “surrender of justice” could expedite the peace process. In short, could deferring the ICC arrest warrant against Omar al-Bashir lead to peace in Sudan?
Filippo Taddei is an Assistant Professor of Economics at SAIS’ Bologna Center, where he teaches macroeconomics and monetary theory. He also serves as a chief economic advisor to the Partito Democratico (PD), which heads Italy’s current coalition government under Prime Minister Matteo Renzi. Prof. Taddei holds degrees in economics from the University of Bologna and Columbia University, where he earned a PhD in 2005. We asked him about Renzi’s plans for Italy and his transition from academic to political advisor.
China’s rise is causing a major upheaval in international relations. The South China Sea is one of the major theatres where a rising China is confronting the existing status quo, threatening not just the Association of Southeast Asian Nations (ASEAN) countries’ maritime claims but also the influence of the US and Japan in the region. What is at stake is not just the territorial claims but also potential hydrocarbon resources, security of international maritime trade and local fishing economies. But despite rising tensions, common interests remains in ensuring that the sea trade remains unaffected. China is still ASEAN’s largest trading partner. The involvement of third parties, while complicating the situation, will help keep conflicting interests in check.