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Showing posts from May, 2015

Austerity (and inequality) in corrupt countries - a conference with Joe Stiglitz

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This week I had an opportunity to attend an international conference "Challenges of Europe: Growth, competitiveness and inequality", where the keynote speakers were none other than 2001 Nobel prize winner Joseph Stiglitz, and Columbia University professor Jan Svejnar
I went there to present a paper I co-authored with two Croatian economists, Dejan Kovac and Nikola Kleut. The paper is called "How do firms respond to anticipated shocks? Duration analysis of Croatian companies throughout the crisis". The paper is pretty good, but let's be honest, that was clearly not the main reason I went there - the main reason was to get to know people like Stiglitz and Svejnar. Which I can happily say I did. 
The keynote speeches from the two notable economists were both very interesting, but also quite different. Svejnar went first and presented his paper called "Do Billionaires Help or Hurt Economic Growth?", while Stiglitz followed with his more or less standar…

In memoriam: John Nash

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It is with great sorrow to report the news that one of the greatest minds in human history died yesterday in a car crash with his wife while they were returning home from an airport. John Forbes Nash Jr., to most widely known as one of the founders of cooperative game theory whose life story was captured by the 2001 film "A Beautiful Mind", is truly one of the greatest mathematicians of all time. His contributions in the field of game theory revolutionized the way we think about economics today, in addition to a whole number of fields - from evolutionary biology to mathematics, from computer science to political science. 

John Nash was born in 1928 in Bluefield, West Virgina. Even as a child he showed great potential and was taking advanced math courses in a local community college on his final year of high school. In 1945 he enrolled an undergraduate mathematics major at the Carnegie Institute of Technology (today Carnegie Mellon). He graduated in 1948 obtaining both a B.S…

Video: How would a Nobel prize winner run the economy?

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From LSE's You Tube channel:

If the video doesn't work (some browsers could do that), see it here.
LSE's Nobel professor Christopher Pissarides is being 'grilled' by Conor Gearty in his Gearty Grillings. The short video surprisingly includes a lot of good ideas on the size of state, labor markets, and the Eurozone troubles. Even though he declares him self an open social democrat, it's obvious he believes in the power institutions and doesn't succumb to any of the typical socialist fallacies. Nor is he being unrealistic about the solutions awaiting Europe. 
Just to remind the readers, Pissarides won the Nobel prize for his search frictions theory in the labor markets. Here's the Nobel prize lecture, and you can find some of his best papers here, and the newest ones here.

Eurozone challenges

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Here's an excellent infographic from Boston University explaining in one place and with much detail why the crisis in Europe is still a long way from being over: 

Boston University Online

If I had to sum it up in words, it would go something like this: sluggish recovery, threat of deflation, high unemployment (11.2%), particularly youth unemployment (23%; the worst still in Spain = 51%), lack of access to finance for small businesses (banks are still hoarding cash), low productivity, low wage growth, an increasing threat of poverty, and of course - still huge levels of public debts (corporate and household as well), coupled with an ageing population which is a lethal combination for a sustainable pensions system, particularly to those countries who in addition to huge debts and an ageing population are experiencing net emigration (Spain, Greece and Italy are leading the way). 
So the overall picture is, unfortunately, still bleak, to say the least. At this moment I don't see h…