Economists Krugman and Stiglitz on Why Greeks Should Vote ‘No’ on the Referendum

Originally posted on Jo Weber Economist & Social Media Expert:

  An anti-austerity march in front of the Greek Parliament in Athens. (Ggia/ CC BY-SA 3.0)

Now that Greece has become the first advanced nation to fall into arrears with the International Monetary Fund, the nation has reached a crucial crossroads: Should it concede to the demands of the “troika” — the institutions representing creditor interests—or continue to reject austerity and prepare to ditch the euro?

Amid mass protests, tumbling markets and bank closures, Greece will hold a referendum Sunday to decide.

Recent opinion pieces by Nobel Prize-winning economists Joseph Stiglitz and Paul Krugman maintain that Greece must keep going it alone and vote no.

Stiglitz writes in The Guardian “… the economics behind the programme that the ‘troika’ (the European Commission, the European Central Bank, and the International Monetary Fund) foisted on Greece five years ago has been abysmal, resulting in a 25% decline in the…

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The euro sucks

Originally posted on LARS P. SYLL:

So, having pushed us hard to accept substantial new austerity, in the form of absurdly large primary surpluses (3.5% of GDP over the medium term) … we ended up having to make recessionary trade-offs between, on the one hand, higher taxes/charges in an economy where those who pay their dues pay through the nose and, on the other, reductions in pensions/benefits in a society already devastated by massive cuts in basic income support for the multiplying needy …

Unfortunately, the institutions’ response was to insist on even more recessionary measures … and, worse still, on shifting the burden massively from business to the weakest members of society (e.g. to reduce the lowest of pensions, to remove support for farmers, to postpone ad infinitum legislation that offers some protection to badly exploited workers).

The institutions new proposals … would make a politically problematic package – from the perspective of our Parliament…

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Mainly Macro

Shared from WordPress

Market Power versus Price-taking in Economic Growth –

A Concise Introduction to Policy Responses to Europe’s fundamental economic challenges

Originally posted on Miguel Costa Matos:

This short essay was written as my submission towards the 1989 Generation Initiative, which will take place in London on the 26th June. I will be participating in the Economic Affairs roundtable alongside Nobel economist Christopher Pissarides, author and former economic adviser to the EU Philippe Legrain and others.

* * *

In this essay, I will discuss what economic policy reforms the EU should prioritise to respond to its fundamental economic challenges. I believe these two fundamental challenges to be the crisis of secular stagnation (de Grauwe, Summers) and the crisis of public finances.

The latter crisis involves two sub-challenges. The first is to deal with debt legacy. When the crisis started, total Eurozone debt stood at 80%. At the end of 2013, it was 95% and 5 countries have debt over 100%. As Paris and Wyplosz note in their MADRE plan, this means that the sovereign debt crisis…

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Does Digital Tech Lower Income & Reduce Jobs?

Originally posted on Delightful & Distinctive COLRS:

Source: HBR, May 2015

 Brynjolfsson and McAfee explain that while digital technologies will help economies grow faster, not everyone will benefit equally—as the latest data already shows. Compared with the Industrial Revolution, digital technologies are more likely to create winner-take-all markets.

once you adjust for inflation, an American household at the 50th percentile of income distribution earns less today than it did in 1998, even after accounting for changes in household size.

… the Great Decoupling. The two halves of the cycle of prosperity are no longer married: Economic abundance, as exemplified by GDP and productivity, has remained on an upward trajectory, but the income and job prospects for typical workers have faltered.

Workers’ prospects are deteriorating in the developing world, too. A recent study by Loukas Karabarbounis and Brent Neiman found that labor’s share of GDP had declined in 42 out of 59 countries, including China, Mexico, and…

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Five For Friday: Costs of War.

Originally posted on middle east revised:

This week, Five For Friday presents five charts and graphics concerning wars in Afganistan, Iraq and Pakistan. These exist thanks to the Costs of Warproject. First released in 2011, the Costs of War report has been compiled and updated by more than 30 economists, anthropologists, lawyers, humanitarian personnel, and political scientists as the first comprehensive analysis of over a decade of wars in Afghanistan, Iraq, and Pakistan.

The project analyzes the implications of these wars in terms of human casualties, economic costs, and civil liberties. Some of this data is from 2011 and 2012, so have in mind that these numbers are probably significantly higher today.

1. Iraqi IDPs and refugees.


There are more than 1.5 million internally displaced Iraqis and 1.5 million Iraqi refugees. Fifty-eight percent of Iraqi IDP households are food insecure, consuming only cereals and carbohydrates on a daily basis. Approximately 500,000 people live as squatters in Iraq. For more on…

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