Artificial intelligence can generate tremendous value for us all, if policymakers and businesses act swiftly and smartly to capture its full benefits and mitigate the inevitable risks. The long-awaited “AI spring” may finally be arriving, but we will need to be prepared to manage … | Continue reading
Where the problem for economies and financial services is lack of competition, residents of developing countries need to look to their own regulators and politicians. The remedy for their woes is not going to come from Mark Zuckerberg. | Continue reading
For the last four decades, mainstream economists and policymakers have been wedded to fixed dogmas. Their blind belief in fiscal discipline and consolidation, and resulting refusal to consider more public spending even in an obvious downturn, now threatens the very stability of s … | Continue reading
The failure to protect minority rights is a readily understood consequence of the political logic behind the emergence of democracy. What requires explanation is not the relative rarity of liberal democracy, but its existence. | Continue reading
The economics profession should not be so defensive toward critics who blame it for rising inequality. Insights from the dismal science – and in particular economists' advocacy of market-based policies to boost prosperity – have proven their worth many times over. | Continue reading
In the face of climate change, rising inequality, and other global crises, governments are losing out on hundreds of billions of dollars in tax revenue as a result of corporate tax arbitrage. Yet despite the obvious deficiencies of the global tax regime, policymakers continue to … | Continue reading
Business cycles can end with a rolling readjustment in which asset values are marked back down to reflect underlying fundamentals, or they can end in depression and mass unemployment. There is never any good reason why the second option should prevail. | Continue reading
By exploiting technologies that were originally developed by the public sector, digital platform companies have acquired a market position that allows them to extract massive rents from consumers and workers alike. Reforming the digital economy so that it serves collective ends i … | Continue reading
In the cyber realm, the same program can be used for legitimate or malicious purposes, depending on the user’s intent. But if that makes traditional arms-control treaties impossible to verify, it may still be possible to set limits on certain types of civilian targets and negotia … | Continue reading
To its credit, China is focusing on sustainable development at a point when its per capita output is barely more than one-third the level in the so-called advanced economies. A relatively poor country has made a conscious choice to shift its focus from the quantity of economic g … | Continue reading
Although low interest rates have traditionally been viewed as positive for economic growth because they encourage businesses to invest in enhancing productivity, this may not be the case. Instead, extremely low rates may lead to slower growth by increasing market concentration an … | Continue reading
More than a decade after the global financial crisis, macroeconomists have failed to absorb three crucial sets of lessons. Their models are still struggling – and mostly failing – to cope with disruptive change, and with the fact that both balance sheets and inequality matter. | Continue reading
The record number of deaths this year on the world's tallest mountain underscores the immorality of seeking to reach the summit. But even if you are lucky enough to reach the top without passing a climber in need of help, you are still choosing your personal goal over saving a li … | Continue reading
Many economists already favor a consumption-based tax system for raising revenue on grounds of efficiency and simplicity. In an environment where wealth inequality is rising inexorably, the case for doing so has become increasingly compelling. | Continue reading
One should always be wary of simple solutions to complex problems, and universal basic income is no exception. The fact that this answer to automation and globalization has been met with such enthusiasm indicates a breakdown not in the economic system, but in democratic politics … | Continue reading
Engineering and medicine have in many respects become separate from their respective underlying sciences of physics and biology. Public-policy schools, which typically have a strong economics focus, must now rethink the way they teach students – and medical schools could offer a … | Continue reading
Failed states used to be largely the preserve of the developing world, where the institutions of democracy do not have deep roots. But given the extent to which the Brexit campaign has undermined Britain's institutions through lies, it is reasonable to worry that the country will … | Continue reading
US President Donald Trump has made no secret of his disdain for experts and evidence-based policymaking. Yet by attempting to gut the US Census Bureau and two key agencies within the Department of Agriculture, he is undercutting the data-gathering institutions upon which broad se … | Continue reading
Current academic research – into the impact of new technologies, the economics of innovation, and the quality of management, for example – may be providing ever more pieces of the puzzle. But many crucial questions about economic progress remain unanswered, and others have not ye … | Continue reading
Facebook's plans for a digital currency and payments system have understandably been met with skepticism, bordering on outrage. Clearly, if a serial violator of the public trust can unilaterally insinuate itself into the global monetary system, something must be done to manage th … | Continue reading
At the same time that science and technology have vastly improved human lives, they have also given certain visionaries the means to transform entire societies from above. Ominously, what was true of Soviet central planners is true of Big Tech today: namely, the assumption that s … | Continue reading
The standard account of China’s economic rise focuses on its state capitalism, whereby the government, endowed with huge assets, can pursue a wide-ranging industrial policy and intervene to mitigate risks. This explanation is wrong. | Continue reading
For years, wealth and income inequalities have been rising within industrialized countries, kicking off a broader debate about technology and globalization. But at the heart of the issue is a fundamental good that has been driving social and economic inequality for centuries: rea … | Continue reading
There is much to be celebrated in the rise of modern megacities, especially in developing countries. But if the trend persists in advanced economies, which is by no means certain, greater public and private innovation will be required to strike a better regional growth balance. | Continue reading
Markets are mechanisms of social choice, in which dollars effectively equal votes; those with more purchasing power thus have more influence over market outcomes. Governments are also social choice mechanisms, but voting power is – or is supposed to be – distributed equally, rega … | Continue reading
Like past waves of technological innovation, the new era of artificial intelligence and automation promises increased productivity, higher wages, and even longer lifespans for everyone. But realizing this potential will require governments and businesses to manage the development … | Continue reading
Governments are right to focus on creating more good jobs, because work is the source of most people’s livelihood in every society. But in the majority of cases, the solution lies in policy areas that are not amenable to tools wielded by ministers of labor or education. | Continue reading
Time and again, the long view in China has stood in sharp contrast to America’s short-term approach. Sun Tzu put it best in his ancient treatise, The Art of War: “If you know the enemy and know yourself, you need not fear the results of a hundred battles.” | Continue reading
Having undergone its longest expansion on record, the US economy appears to be thriving. But behind the headline numbers is a more complicated story: wages are growing, but not as fast as they should be; and inequalities based on place, race, gender, and other factors remain unac … | Continue reading
In the early 1980s, the chairman of the US Federal Reserve, Paul Volcker, was able to choke off runaway inflation because he was afforded the autonomy necessary to implement steep interest-rate hikes. Today, the Fed is clearly under unprecedented political pressure, and it is sta … | Continue reading
The goal of economics is to replace the particular languages that obstruct the discovery of general laws with the universal language of mathematics. This is the apotheosis of a Western conceit that can no longer be sustained by Western power. | Continue reading
Following the 2008 global financial crisis, central banks bet that greater activism on the part of other policymakers would be their salvation, helping them to normalize their operations. But that activism never came, and central bankers are now facing a lose-lose proposition. | Continue reading
Worsening economic inequality in recent years is largely the result of policy choices that reflect the political influence and lobbying power of the rich. There is now a self-reinforcing pattern of high profits, low investment, and rising inequality – posing a threat not only to … | Continue reading
It is common to hear people complain that we live in an era in which self-interest prevails, moral standards have collapsed, few care about others, and most people would steal if they thought they could get away with it. But a new study covering 40 countries provides solid eviden … | Continue reading
Across the advanced economies, monetary and fiscal policymakers lack the tools needed to respond to another major downturn and financial crisis. Worse, while the world no longer needs to worry about a hawkish US Federal Reserve strangling growth, it now has an even bigger problem … | Continue reading
Since the federal funds rate peaked at 22% in the early 1980s, inflation in the United States has remained low and stable, leading many to believe that the mere threat of renewed interest-rate hikes has kept it in check. But no one really knows why inflation has been subdued for … | Continue reading
President Donald Trump's manipulation of America's privileged international system will strengthen other countries' incentives to extricate themselves from US networks of interdependence in the long run. In the meantime, there will be costly damage to the international institutio … | Continue reading
Only a fool would trust Facebook with his or her financial wellbeing. But maybe that’s the point: with so much personal data on some 2.4 billion monthly active users, who knows better than Facebook just how many suckers are born every minute? | Continue reading
It is currently unclear how popular Libra, Facebook's proposed new global cryptocurrency, might become, and what problems this may cause. But inflation – and policymakers’ reduced ability to control it – has to figure prominently on the list of possible risks. | Continue reading
“Be wary then; best safety lies in fear,” said Laertes to Ophelia as she embarked on her doomed dalliance with Hamlet. That is sound advice for banks and their regulators, too, as they face the prospect of technological disruption. | Continue reading
After years of disregarding privacy, exploiting user data, and failing to control its platform, Facebook has now unveiled a cryptocurrency and payment system that could take down the entire global economy. Governments must intervene before a company that "moves fast and breaks th … | Continue reading
Policy gurus spend too much time with others like them – top civil servants, high-flying journalists, successful businesspeople – and too little time with ordinary voters. If they could become “humble, competent people on a level with dentists,” as John Maynard Keynes once sugges … | Continue reading
Recent images of long lines at the Mount Everest base camp, and at choke points on the way to the summit, offer a perfect real-world example of mismanaged supply and demand. As in a number of other economic-policy areas, a combination of price adjustments and regulation offers th … | Continue reading
Mainstream economics has largely failed to keep up with the rapid pace of digital transformation, and it is struggling to find practical ways to address the growing power of dominant tech companies. If economists want to remain relevant, they must rethink some of their discipline … | Continue reading
The next breakthrough in foundational research will be decoding how the human immune system prevents and controls disease. Artificial intelligence and machine learning will be the keys to this achievement, transforming the future of human health just as they are now changing othe … | Continue reading
When anti-establishment populists come to power, they implement a range of policies that lead to lower economic growth and fewer good jobs. And yet the angrier people become, the easier it is to persuade them that the media are biased, the experts are always wrong, and the facts … | Continue reading
Since the world’s major central banks came to the global economy’s rescue in 2008, they have had more and more tasks foisted upon them, even as some politicians question their expanded role and others seek to undermine their policymaking autonomy. To escape this dilemma, monetary … | Continue reading
For the past 40 years, the United States and other advanced economies have been pursuing a free-market agenda of low taxes, deregulation, and cuts to social programs. There can no longer be any doubt that this approach has failed spectacularly; the only question is what will – an … | Continue reading