Will the Volcker Rule Lead to Positive Change?

PERI Co-Director Gerald Epstein writes in Intereconomics 2014 about the Volcker Rule, which was one major component of the Dodd-Frank financial regulatory laws that followed from the 2007-09 financial crisis.  The detailed features of Volcker Rule took three years to write after the passage in 2010 of Dodd-Frank.  This gave Wall Street a chance to gut the new regulations.  Epstein asks: Has the Volcker rule been so “Swiss-cheesed” that it has too many holes to be of value? Or is there enough substance to make the financial system safer and more socially productive?

>> Read “Volcker Rule: Swiss-Cheesed or Beefed Up?”

Climate Policy as Wealth Creation

Carbon pricing can help drive investment in renewables and energy efficiency. If and when we price emissions, a crucial economic and political question is: Who will get the money? The government, to use it to fund public spending or cut taxes? Corporations, which will get free permits and reap windfall profits? Or the public, as equal per person dividends, since nature’s gifts belong in common to us all? Earlier this month, PERI’s James K. Boyce delivered a lecture at The University of Pittsburg Honors College which examined this question.

>> Watch the lecture and presentation, including a moderated panel

Race, Ethnicity and Income Disparities in Exposure to Air Toxics

People of color and low-income communities tend to face disproportionate pollution hazards in the United States. But patterns of environmental inequality may vary from place to place. In this working paper, Klara Zwickl, Michael Ash, and James K. Boyce (Director of PERI’s Program on Development, Peacebuilding, and the Environment) investigate two questions: Do racial and ethnic disparities in exposure to industrial air toxics decline with rising incomes? And given inter-regional differences in the history of industrial development, patterns of immigration, and the extent of residential segregation, are there significant variations across regions in patterns of environmental inequality?

>> Read “Regional variation in environmental inequality: Industrial air toxics exposure in U.S. cities”

Macroeconomic Policy in Sub-Saharan Africa

The current prevailing approach to macroeconomic policy in Africa might be described as trying to "do no harm" — i.e. gross mismanagement, such as unsustainable debts or rapid inflation. But this approach shortchanges African countries. The challenge is to replenish the economic toolkit available to African countries and allowing macroeconomic policy to play a more developmental role.

James Heintz, PERI Associate Director, writes in a chapter in The Industrial Policy Revolution II: Africa in the 21st Century about three areas of macroeconomic policy – real exchange rate, monetary policy, and fiscal policy – that have implications for industrial development in Africa.

>> Read further description, “How Macroeconomic Policy Can Support Economic Development in Sub-Saharan African Countries”

>> Purchase The Industrial Policy Revolution II: Africa in the 21st Century

How Big is Too Big? Finance's Impact on the Health of the Economy

“How Big is Too Big? What Should Finance Do and How Much Should It Be Cut Down To Size?”: These are the questions posed at a recent panel at the Eastern Economics Association Conference organized by PERI Co-Director Gerald Epstein. Three presentations from Epstein’s co-authors reported on results from a research project funded by the Institute for New Economic Thinking. The project addresses various aspects of impacts of finance on the health of the economy, in the U.S. and other advanced capitalist countries. The presentations raise serious questions concerning the social efficiency of finance as currently constituted. 

>> Read description of the Eastern Economics Association panel 

Download presentations:
>> Understanding Financial Innovation
>> Intersectoral Financial Flows and Non-Financial Corporate Investment in the USA and Europe
>> Intra-Financial Lending, Credit, and Capital Formation

Download working papers:
>> Long-term trends in Intra-Financial Sector Lending in the US: 1950-2012
>> Intra-Financial Lending, Credit, and Capital Formation
>> Sectoral Net Lending in Six Financial Sectors