| Levy Scholars Present at Online Events
On August 19, Senior Scholar Jan Kregel spoke with Global Political Economy’s Lynn Fries about Distinguished Scholar Hyman P. Minsky’s work on stabilizing an unstable economy. Kregel outlines Minsky’s ideas on how fragility builds up in an ever-changing capitalist system, its consequences for global finance, and possible avenues for building a more stable system, noting that “Minsky’s proposal was that not only do you need the objective for the economy to be full employment but you have to be willing to structure your economic policy in order to ensure that particular objective.”
Senior Scholar L. Randall Wray has offered several virtual talks on Modern Money Theory (MMT), most recently for a PEPI-IE/UFRJ webinar, “Teoria Monetária Moderna” on September 9. In an August 21 discussion with BTR Today’s Joe Virgillito, Wray dispels some common myths about MMT and suggests that its tenets support “the kind of bold economic action that may be needed to deal with the economic consequences of the pandemic,” a sentiment he echos in an August 10 chat with Andrew Hilton, director of the Centre for the Study of Financial Innovation. |
Public Policy Brief No. 153, September 2020
Luiza Nassif-Pires, Laura Carvalho, and Eduardo Rawet
After spending over 6 percent of GDP responding to the COVID-19 crisis, Brazil has suffered among the worst per capita numbers in the world in terms of cases and deaths. In this policy brief, Research Fellow Luiza Nassif-Pires, Laura Carvalho, University of São Paulo, and Eduardo Rawet, American University, explore how stark inequalities can help account for why the pandemic has had such a damaging impact and why broader policy changes are necessary for addressing dimensions of inequality that are rooted in structural racism.
Read complete text (pdf) |
Public Policy Brief No. 152, August 2020
Alex Williams
This policy brief by Alex Williams (’20) challenges the argument that states receiving fiscal aid during a recession are taking advantage of the federal government in pursuit of localized benefits with dispersed costs and, in response, offers a novel framework for understanding the relationship between the business cycle and fiscal federalism in the United States.
One-Pager No. 64 provides a condensed version of the full policy brief.
Read complete text (pdf) |
Debt Management and the Fiscal Balance
Jan Toporowski
Jan Toporowski, SOAS University of London, provides an analysis of government debt management using fiscal principles derived from the work of Michal Kalecki, demonstrating how, by splitting the budget into a functional budget that affects the real economy and a financial budget that just maintains debt payments and the liquidity of the financial system, the government can have two independent instruments that can target, respectively, the macroeconomy and government debt—overcoming a dilemma that makes fiscal policy ineffective.
Read complete text (pdf) |
Working Paper No. 968, September 2020
Leonardo Burlamaqui and Ernani T. Torres Filho
Writing in May–June 2020, Research Associate Leonardo Burlamaqui and Ernani T. Torres Filho, Federal University of Rio de Janeiro, investigate the COVID-19 pandemic through an extension of Hyman Minsky’s financial fragility analysis, building a three-pronged analytical framework that encompasses the interconnected processes of financial fragility, financial instability, and insolvency-triggered asset-liability restructuring processes. Highlighting the key policy interventions and institutional innovations introduced so far, the authors suggest further measures for addressing the forthcoming stages of the financial turmoil.
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Working Paper No. 966, August 2020
Jerome De Henau and Susan Himmelweit
Presenting results of a cross-country comparison of investment in the care and construction industries, Jerome De Henau and Susan Himmelweit, Open University, UK, discuss new methods of combined macro-micro analysis of labor demand and supply to investigate the gender impacts of public policy, accounting for the policy’s labor supply effects to achieve a more accurate assessment of its full impact on employment inequalities.
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Working Paper No. 965, July 2020
Sameh Hallaq
Research Associate Sameh Hallaq uses the instrumental variable approach to estimate the intergenerational transmission of human capital in Palestine to ascertain whether formal parental education improves their offspring’s cognitive skills and school achievements. Accounting for the variation in parental educational attainment given their exposure to the First Palestinian Intifada (1988–93) during their middle- and high school ages, he finds that the results support the hypothesis of a human capital spillover, but more so for girls than for boys.
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Working Paper No. 963, July 2020
Michelle Holder, Janelle Jones, and Thomas Masterson
As the COVID-19 pandemic unfolded, many workers were able to do their jobs from their homes, but a high proportion of “essential workers” were African American, other people of color, women, and an intersection of these groups—women of color. Michelle Holder, John Jay College, Janelle Jones, Groundwork Collaborative, and Research Scholar Thomas Masterson examine the contours, depth, and causes of the pandemic’s impact on Black women’s employment in the United States through the lenses of both feminist economic theory and stratification economics.
The data appendix for Holder, Jones, and Masterson, available here, includes detailed tables of major labor force indicators by race and sex; employment by race, sex, and industry and occupation; and unemployment by race and sex for early 2020.
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Working Paper No. 962, July 2020
Tanweer Akram, General Motors, and Huiqing Li, Central University of Finance and Economics, model the dynamics of Japanese government bond (JGB) nominal yields using daily data, asserting their findings can be useful not only to investors and market analysts, but also to central bankers and other policymakers for assessing financial conditions and macroeconomic developments in real time.
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Working Paper No. 961, July 2020
L. Randall Wray
Modern Money Theory (MMT) synthesizes several traditions from heterodox economics to describe monetary and fiscal operations in nations that issue a sovereign currency, integrating the credit and state theories of money to assess policies related to the current challenges facing modern economies. In this working paper, Senior Scholar L. Randall Wray outlines the development of the “Kansas City” approach to MMT at the University of Missouri–Kansas City (UMKC) and the Levy Economics Institute of Bard College.
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Working Paper No. 960, July 2020
Bendreff Desilus
Over the past 30 years, developing countries have failed to increase their real wages due to the lack of domestic value-added in the era of globalization, where global supply chains are the driving factor for attracting foreign direct investment. Bendreff Desilus, La Salle University, Mexico Business School, critically examines the results of postcrisis fiscal policy adopted in Argentina, Brazil, and Mexico against the background of the United Nations’ 2030 Agenda for Sustainable Development.
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M.A. Program in Economic Theory and Policy Now Accepting Students for Spring of 2021 |
We are pleased to announce that both our M.A. and M.S. program are now accepting students for spring 2021.
Designed as preparation for a professional career in economic research and policy formulation, the Levy Economics Institute Graduate Programs in Economic Theory and Policy offer an alternative to mainstream programs in economics and finance.
To find out more about our innovative programs that combine a rigorous course of study with exceptional opportunity to participate in advanced economics research alongside the Institute’s global network of researchers, visit bard.edu/levygrad or follow the program's Facebook page.
Applications for spring 2021 are now open. Interested students should contact the program recruiter, Martha Tepepa ([email protected]), to discuss their options. Scholarships are available. |
In a June 28 article for ABCNews, Institute President Dimitri B. Papadimitriou noted that the “income, racial, and gender inequality in the US… engenders an element of a vicious circle at work: not only will the pandemic and its fallout worsen inequality; inequality will exacerbate the spread of the virus, not to mention undermine any ensuing economic recovery efforts,” while the false narrative that “we are all in this together distracts us from the socioeconomic dimensions of the COVID-19 crisis." The article also cites Public Policy Brief No. 149 and its conclusion that income inequality has intensified the pandemic’s effects.
As Congress works to agree on a new round of stimulus for the pandemic-stricken economy, two big ideas that have been thoroughly researched at the Institute are getting attention: a public service employment (or jobs guarantee) program and student debt forgiveness. In their opinion piece for Project Syndicate, Mariana Mazzucato and Robert Skidelsky recommend a public employment program, as outlined in Policy Note 2018/3, for building a stronger postpandemic economy. In promoting her recent book on the subject, Research Associate Pavlina Tcherneva has discussed the benefits of government-guaranteed employment with several outlets, including Bloomberg, NPR’s Marketplace, The San Francisco Chronicle, Business Insider, and WNYC, while forgiving student loan debt as a component of a COVID-19 relief package has been considered on CNN, inequality.org, and Common Dreams.
Marokey Sawo’s (’20) coauthored memo for the Groundwork Collaborative and the National Employment Law Project was cited by Huffington Post for its conclusions that most unemployment claimants may be earning less on unemployment than they did at their previous jobs. Refuting a previous University of Chicago study’s findings that more than two-thirds of unemployment claimants received more in benefits than they did from work, the study includes nonwage benefits amounting to 28 percent total average work compensation to find that “individuals are likely receiving less, not more, in unemployment than they were in their former jobs, even after accounting for the $600 per week benefits boost.”
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