Negative interest rate policy has become a consensus position within the economics establishment. But Thomas Palley argues that this consensus is dangerously wrong. The approach draws on the fallacious theoretical position that there is a natural rate of interest which can ensure full employment, and further, that the natural rate may be negative in times of severe demand shortage. Policy interventions must then deliver negative rates since the market cannot. Palley explains how this approach ignores the possibility that negative interest rates may reduce aggregate demand and contribute to financial fragility.  

Tyler Hansen and PERI Co-Director Robert Pollin analyze fossil fuel divestment campaigns as a strategy for advancing an effective global climate stabilization project.  They examine data on global divestment patterns and evaluate econometrically the impact of divestment events on the stock market prices of fossil fuel companies.  They conclude that divestment movements have not been especially effective as a means of significantly reducing CO₂ emissions.  The paper suggests that most efforts now devoted to divestment campaigns would be better spent on more direct efforts to drive down fossil fuel consumption and CO₂ emissions.

The 2015 Paris Agreement adopted the goal of limiting the rise in global mean temperature to 1.5 – 2 °C above pre-industrial levels. In this paper forthcoming in Ecological Economics, PERI economist James Boyce argues that carbon pricing can play a key role in meeting this objective, either through a cap-and-permit system or a carbon tax indexed to a fixed emission-reduction trajectory.  But carbon pricing can have significant regressive distributional impacts, raising energy prices disproportionately on lower-income people. Boyce shows how these distributional impacts can be addressed by universal dividends funded by carbon revenues.