Summary Spring 2015

This issue of the Summary opens with the latest strategic analysis of the Greek economy using the Levy Institute Model for Greece. The authors find that despite some modest improvements in the country’s economy, continued austerity will not lead to growth. They recommend an end to austerity, call for debt relief, and propose direct intervention in the labor market to spur growth. The strategic analysis is followed by a proposal to resolve the euro-area sovereign debt overhang. Two policy briefs take up current issues surrounding the policies of the Federal Reserve, while a working paper reviews lessons learned from the exercise of monetary policy by the Reserve Bank of India. A paper on the impact of the repeal of the Glass-Steagall Act and the Fed’s subsequent extraordinary actions is also included. Several papers examine the nature and role of state investment banks in creating and shaping the economy. A number of authors contribute papers that apply the work of Distinguished Scholar Hyman P. Minsky to such questions as policymaking in emerging economies, endogenous money, prudent banking practices, and the socialization of investment. This issue also includes a discussion of the quality of the statistical match used in the creation of the Levy Institute’s integrated inequality assessment model. And, finally, a paper on the evolution of rising inequality, as measured by the Gini index, in the post–World War II period reveals two distinct patterns in income inequality.

INSTITUTE RESEARCH

Program: The State of the US and World Economies

Strategic Analysis

• DIMITRI B. PAPADIMITRIOU, MICHALIS NIKIFOROS, GENNARO ZEZZA, Is Greece Heading For a Recovery?

• DIMITRIS P. SOTIROPOULOS, JOHN MILIOS, and SPYROS LAPATSIORAS, An Outline of a Progressive Resolution to the Euro-area Sovereign Debt Overhang: How a Five-year Suspension of the Debt Burden Could Overthrow Austerity

Program: Monetary Policy and Financial Structure

• JAN KREGEL, Why Raising Rates May Speed the Recovery
• JAN KREGEL, Liquidity Preference and the Entry and Exit to ZIRP and QE
• SRINIVAS YANAMANDRA, Minsky, Monetary Policy, and Mint Street: Challenges for the Art of Monetary Policymaking in Emerging Economies
• L. RANDALL WRAY, Outside Money: The Advantages of Owning the Magic Porridge Pot
• RICCARDO BELLOFIORE, The Socialization of Investment, from Keynes to Minsky and Beyond
• FELIPE REZENDE, Why Does Brazil’s Banking Sector Need Public Banks? What Should BNDES Do?
• L. RANDALL WRAY, Minsky on Banking: Early Work on Endogenous Money and the Prudent Banker
• SUNANDA SEN and ZICO DASGUPTA, Financialization and Corporate Investments: The Indian Case
• YEVA NERSISYAN, The Repeal of the Glass-Steagall Act and the Federal Reserve’s Extraordinary Intervention during the Global Financial Crisis
• MARIANA MAZZUCATO and CAETANO C. R. PENNA, Beyond Market Failures: The Market Creating and Shaping Roles of State Investment Banks

Program: The Distribution of Income and Wealth

• MARKUS P. A. SCHNEIDER and DANIELE TAVANI, Tale of Two Ginis in the United States, 1921–2012
• FERNANDO RIOS-AVILA, Quality of Match for Statistical Matches Using the Consumer Expenditure Survey 2011 and Annual Social Economic Supplement 2011

Program: Economic Policy in the 21st Century

Explorations in Theory and Empirical Analysis

• GIOVANNA VERTOVA, The State and National Systems of Innovation: A Sympathetic Critique
• MARIANA MAZZUCATO, Building the Entrepreneurial State: A New Framework for Envisioning and Evaluating a Mission-oriented Public Sector

INSTITUTE NEWS

• Levy Scholar Appointed Greek Deputy Labor Minister
• Levy Research Associate Appointed to Senate Budget Committee

New Books in the Levy Institute Book Series

• Economic Development and Financial Instability: Selected Essays, by Jan Kregel
• Contributions to Economic Theory, Policy, Development and Finance: Essays in Honor of Jan A. Kregel, edited by Dimitri B. Papadimitriou

Upcoming Events

• 24th Annual Hyman P. Minsky Conference
• The Hyman P. Minsky Summer Seminar

PUBLICATIONS AND PRESENTATIONS

• Publications and Presentations by Levy Institute Scholars
• Recent Levy Institute Publications