In “The American Corporation in Crisis—Let’s Rethink It,” PERI researcher Lenore Palladino argues that, for decades, the concept of shareholder primacy in corporate organization has abandoned the idea that corporations’ employees should benefit when the corporations are succeeding. Over recent decades, the commitment to shareholder primacy has contributed to the persistent rise of inequality between workers versus their employers—i.e., top management and share owners. Palladino proposes approaches to create more egalitarian corporate structures. Thirteen leading analysts comment on Palladino’s proposals in a special Boston Review Forum, and Palladino responds to the commentators.
Read more...
Why Modern Money Theory Doesn't Work for Developing Countries
In “Modern Money Theory (MMT) in the Tropics,” Matías Vernengo and Esteban Pérez Caldentey discuss the limitations of this approach for developing countries that have a sovereign currency, but borrow in foreign currencies. This creates a balance of payments constraint. They then analyze the limits of a country borrowing in its own currency, because the country can experience a currency devaluation, which then also creates balance of payments difficulties. They argue against flexible rates as a solution to this problem, in favor of managed exchange rates with capital controls.
Read more...
An Egalitarian Global Carbon Tax
In “Balancing the Climate Injustice: A Proposal for a Differential Global Carbon Tax,” PERI researcher Shouvik Chakraborty and Rohit Azad argue for a differential carbon tax across the globe to support a green energy transition. All countries would pay tax rates according to their respective shares in global emissions. With the global carbon tax at $46 per ton, Chakraborty and Azad estimate that the total ‘carbon compensation’ made by the ‘payer’ nations—those that, per capita, pollute more than average—comes to around $570 billion. These funds should then be channeled into financing the global energy transition in low-income countries.
Keynes Against Capitalism
In Keynes Against Capitalism, PERI researcher James Crotty demonstrates that John Maynard Keynes—the most influential economist of the 20th Century—advanced a coherent program on behalf of 'Liberal Socialism.' Crotty's view sharply diverges from mainstream perspectives which have long held that Keynes's overarching project was mild reform of capitalism. Professor James Galbraith writes "This book is a marvel of economic narrative, with Crotty's clarity and Keynes's elegance in stunning counterpoint, from Versailles through the Depression to the war and Bretton Woods, all bringing forth the great, neglected fact that Keynes's Liberal Socialism was far more radical than modern memory would have us think."
Read more...