Hal S. Scott
- Published in print:
- 2016
- Published Online:
- January 2017
- ISBN:
- 9780262034371
- eISBN:
- 9780262332156
- Item type:
- book
- Publisher:
- The MIT Press
- DOI:
- 10.7551/mitpress/9780262034371.001.0001
- Subject:
- Economics and Finance, Economic History
The Dodd–Frank Act of 2010 was intended to reform financial policies in order to prevent another massive crisis such as the financial meltdown of 2008. Dodd–Frank is largely premised on the diagnosis ...
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The Dodd–Frank Act of 2010 was intended to reform financial policies in order to prevent another massive crisis such as the financial meltdown of 2008. Dodd–Frank is largely premised on the diagnosis that connectedness was the major problem in that crisis—that is, that financial institutions were overexposed to one another, resulting in a possible chain reaction of failures. This book argues that it is not connectedness but contagion that is the most significant element of systemic risk facing the financial system. Contagion is an indiscriminate run by short-term creditors of financial institutions that can render otherwise solvent institutions insolvent. It poses a serious risk because, as the book explains, our financial system still depends on approximately $7.4 to $8.2 trillion of runnable and uninsured short-term liabilities, 60 percent of which are held by nonbanks. The book argues that efforts by the Federal Reserve, the FDIC, and the Treasury to stop the contagion that exploded after the bankruptcy of Lehman Brothers lessened the economic damage. And yet Congress, spurred by the public's aversion to bailouts, has dramatically weakened the power of the government to respond to contagion, including limitations on the Federal Reserve's powers as a lender of last resort. Offering uniquely detailed forensic analyses of the Lehman Brothers and AIG failures, and suggesting alternative regulatory approaches, the book makes the case that we need to restore and strengthen our weapons for fighting contagion.Less
The Dodd–Frank Act of 2010 was intended to reform financial policies in order to prevent another massive crisis such as the financial meltdown of 2008. Dodd–Frank is largely premised on the diagnosis that connectedness was the major problem in that crisis—that is, that financial institutions were overexposed to one another, resulting in a possible chain reaction of failures. This book argues that it is not connectedness but contagion that is the most significant element of systemic risk facing the financial system. Contagion is an indiscriminate run by short-term creditors of financial institutions that can render otherwise solvent institutions insolvent. It poses a serious risk because, as the book explains, our financial system still depends on approximately $7.4 to $8.2 trillion of runnable and uninsured short-term liabilities, 60 percent of which are held by nonbanks. The book argues that efforts by the Federal Reserve, the FDIC, and the Treasury to stop the contagion that exploded after the bankruptcy of Lehman Brothers lessened the economic damage. And yet Congress, spurred by the public's aversion to bailouts, has dramatically weakened the power of the government to respond to contagion, including limitations on the Federal Reserve's powers as a lender of last resort. Offering uniquely detailed forensic analyses of the Lehman Brothers and AIG failures, and suggesting alternative regulatory approaches, the book makes the case that we need to restore and strengthen our weapons for fighting contagion.
Matteo Cervellati and Uwe Sunde (eds)
- Published in print:
- 2017
- Published Online:
- May 2018
- ISBN:
- 9780262036627
- eISBN:
- 9780262341660
- Item type:
- book
- Publisher:
- The MIT Press
- DOI:
- 10.7551/mitpress/9780262036627.001.0001
- Subject:
- Economics and Finance, Economic History
Over the last two hundred years, mortality and fertility levels in the Western world have dropped to unprecedented levels. This demographic transition was accompanied by an economic transition that ...
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Over the last two hundred years, mortality and fertility levels in the Western world have dropped to unprecedented levels. This demographic transition was accompanied by an economic transition that led to widespread education and economic growth after centuries of near-stagnation. At the same time, other changes have occurred in family structures, culture, and the organization of society. Economists have only recently begun to take into account the demographic transition from high mortality and high fertility when modeling and researching economic development. This book reviews recent approaches to economic demography, considering such topics as the bio-geographic origins of comparative development differences; the role of health improvements and mortality decline; as well as physiological, familial, cultural, and social aspects. After an overview of the study of demography and economic demography, the chapters cover subjects including the Neolithic era and the period of the formation of states and social institutions; longevity and economic growth; household decision making and fertility; land inequality, education, and marriage in nineteenth century Prussia; and caste systems and technology in pre-modern societies. The book concludes with a call for further investigation of the institutional and social factors that influence demographics and economies, suggesting that unified growth theory offers a potential approach to studying development.Less
Over the last two hundred years, mortality and fertility levels in the Western world have dropped to unprecedented levels. This demographic transition was accompanied by an economic transition that led to widespread education and economic growth after centuries of near-stagnation. At the same time, other changes have occurred in family structures, culture, and the organization of society. Economists have only recently begun to take into account the demographic transition from high mortality and high fertility when modeling and researching economic development. This book reviews recent approaches to economic demography, considering such topics as the bio-geographic origins of comparative development differences; the role of health improvements and mortality decline; as well as physiological, familial, cultural, and social aspects. After an overview of the study of demography and economic demography, the chapters cover subjects including the Neolithic era and the period of the formation of states and social institutions; longevity and economic growth; household decision making and fertility; land inequality, education, and marriage in nineteenth century Prussia; and caste systems and technology in pre-modern societies. The book concludes with a call for further investigation of the institutional and social factors that influence demographics and economies, suggesting that unified growth theory offers a potential approach to studying development.
Naomi R Lamoreaux and Kenneth L Sokoloff (eds)
- Published in print:
- 2007
- Published Online:
- August 2013
- ISBN:
- 9780262122894
- eISBN:
- 9780262277884
- Item type:
- book
- Publisher:
- The MIT Press
- DOI:
- 10.7551/mitpress/9780262122894.001.0001
- Subject:
- Economics and Finance, Economic History
Although technological change is vital for economic growth, the interaction of finance and technological innovation is rarely studied. This book examines the ways in which innovation is funded in the ...
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Although technological change is vital for economic growth, the interaction of finance and technological innovation is rarely studied. This book examines the ways in which innovation is funded in the United States. In case studies and theoretical discussions, economists and economic historians analyze how inventors and technologically creative entrepreneurs have raised funds for their projects at different stages of U.S. economic development, beginning with the post-Civil War period of the Second Industrial Revolution. Their discussions point to intriguing insights about how the nature of the technology may influence its financing and, conversely, how the availability of funds influences technological advances. These studies show that over the long history of American technological advancement, inventors, and innovators have shown considerable flexibility in finding ways to finance their work. They have moved to cities to find groups of local investors; they have worked for large firms that could tap the securities market for funds; they have looked to the federal government for research and development funding; and they have been financed by the venture capital industry. The studies make it clear that methods of funding innovation—whether it is in the auto industry or information technology—have important implications for both the direction of technological change and the competitive dynamism of the economy.Less
Although technological change is vital for economic growth, the interaction of finance and technological innovation is rarely studied. This book examines the ways in which innovation is funded in the United States. In case studies and theoretical discussions, economists and economic historians analyze how inventors and technologically creative entrepreneurs have raised funds for their projects at different stages of U.S. economic development, beginning with the post-Civil War period of the Second Industrial Revolution. Their discussions point to intriguing insights about how the nature of the technology may influence its financing and, conversely, how the availability of funds influences technological advances. These studies show that over the long history of American technological advancement, inventors, and innovators have shown considerable flexibility in finding ways to finance their work. They have moved to cities to find groups of local investors; they have worked for large firms that could tap the securities market for funds; they have looked to the federal government for research and development funding; and they have been financed by the venture capital industry. The studies make it clear that methods of funding innovation—whether it is in the auto industry or information technology—have important implications for both the direction of technological change and the competitive dynamism of the economy.
Roger W. Spencer and David A. Macpherson (eds)
- Published in print:
- 2014
- Published Online:
- May 2015
- ISBN:
- 9780262027960
- eISBN:
- 9780262325868
- Item type:
- book
- Publisher:
- The MIT Press
- DOI:
- 10.7551/mitpress/9780262027960.001.0001
- Subject:
- Economics and Finance, Economic History
This book is an informal history of modern economic thought as told through autobiographical chapters by twenty-three Nobel Prize laureates in Economics. The chapters not only provide unique insights ...
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This book is an informal history of modern economic thought as told through autobiographical chapters by twenty-three Nobel Prize laureates in Economics. The chapters not only provide unique insights into major economic ideas of our time but also shed light on the processes of intellectual discovery and creativity. This edition adds four recent Nobelists to its pages: Eric Maskin, who illustrates his explanation of mechanism design with an example involving a mother, a cake, and two children; Joseph Stiglitz, who recounts his field's ideological wars linked to policy disputes; Paul Krugman, who describes the insights he gained from studying the model of the Capitol Hill Babysitting Coop (and the recession it suffered when more people wanted to accumulate babysitting coupons than redeem them); and Peter Diamond, who maps his development from student to teacher to policy analyst. This text grows out of a continuing lecture series at Trinity University in San Antonio, which invites Nobelists from American universities to describe their evolution as economists in personal as well as technical terms.Less
This book is an informal history of modern economic thought as told through autobiographical chapters by twenty-three Nobel Prize laureates in Economics. The chapters not only provide unique insights into major economic ideas of our time but also shed light on the processes of intellectual discovery and creativity. This edition adds four recent Nobelists to its pages: Eric Maskin, who illustrates his explanation of mechanism design with an example involving a mother, a cake, and two children; Joseph Stiglitz, who recounts his field's ideological wars linked to policy disputes; Paul Krugman, who describes the insights he gained from studying the model of the Capitol Hill Babysitting Coop (and the recession it suffered when more people wanted to accumulate babysitting coupons than redeem them); and Peter Diamond, who maps his development from student to teacher to policy analyst. This text grows out of a continuing lecture series at Trinity University in San Antonio, which invites Nobelists from American universities to describe their evolution as economists in personal as well as technical terms.
Jeffrey G. Williamson
- Published in print:
- 2011
- Published Online:
- August 2013
- ISBN:
- 9780262015158
- eISBN:
- 9780262295727
- Item type:
- book
- Publisher:
- The MIT Press
- DOI:
- 10.7551/mitpress/9780262015158.001.0001
- Subject:
- Economics and Finance, Economic History
Today’s wide economic gap between the postindustrial countries of the West and the poorer countries of the third world is not new. Fifty years ago, the world economic order — two hundred years in the ...
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Today’s wide economic gap between the postindustrial countries of the West and the poorer countries of the third world is not new. Fifty years ago, the world economic order — two hundred years in the making — was already characterized by a vast difference in per capita income between rich and poor countries and by the fact that poor countries exported commodities (agricultural or mineral products) while rich countries exported manufactured products. This book traces the great divergence between the third world and the West to this nexus of trade, commodity specialization, and poverty. Analyzing the role of specialization, de-industrialization, and commodity price volatility with econometrics and case studies of India, Ottoman Turkey, and Mexico, it demonstrates why the close correlation between trade and poverty emerged. Globalization and the great divergence were causally related, and thus the rise of globalization over the past two centuries helps account for the income gap between rich and poor countries today.Less
Today’s wide economic gap between the postindustrial countries of the West and the poorer countries of the third world is not new. Fifty years ago, the world economic order — two hundred years in the making — was already characterized by a vast difference in per capita income between rich and poor countries and by the fact that poor countries exported commodities (agricultural or mineral products) while rich countries exported manufactured products. This book traces the great divergence between the third world and the West to this nexus of trade, commodity specialization, and poverty. Analyzing the role of specialization, de-industrialization, and commodity price volatility with econometrics and case studies of India, Ottoman Turkey, and Mexico, it demonstrates why the close correlation between trade and poverty emerged. Globalization and the great divergence were causally related, and thus the rise of globalization over the past two centuries helps account for the income gap between rich and poor countries today.
