We investigate whether income inequality affects subsequent growth in a cross-country sample for 1965-90, using the models of Barro (1997), Bleaney and Nishiyama (2002) and Sachs and Warner (1997), with negative results. We then investigate the evolution of income inequality over the same period and its correlation with growth. The dominating feature is inequality convergence across countries. This convergence has been significantly faster amongst developed countries. Growth does not appear to influence the evolution of inequality over time. Outline

https://www.econstor.eu/bitstream/10419/81822/1/02-28.pdf

Economic growth and income inequality

Utility Analysis and the Consumption Function: An Interpretation of Cross-Section Data

Geography and Trade

This paper describes the correlations between inequality and the growth rates in cross-country data. Using non-parametric methods, we show that the growth rate is an inverted U-shaped function of net changes in inequality: Changes in inequality (in any direction) are associated with reduced growth in the next period. The estimated relationship is robust to variations in control variables and estimation methods. This inverted U-curve is consistent with a simple political economy model, although, as we point out, efforts to interpret this model causally run into difficult identification problems. We show that this non-linearity is sufficient to explain why previous estimates of the relationship between the level of inequality and growth are so different from one another.

Inequality and Growth: What Can the Data Say?

The Price of Inequality: How Today's Divided Society Endangers Our Future. Joseph E. Stiglitz, 414 pages, New York: W. W. Norton & Company, 2012.I LOVE THESE GUYS''(Joseph Stiglitz) is an insanely great economist,'' so writes Paul R. Krugman, who should know. These two like to write books for the populace at large on the topic of macroeconomics. Krugman also likes to spout offon Sunday news shows like ''Meet the Press,'' and on all the cable news programs. You can see Krugman arguing with Bill O'Reilly on Meet the Press. From YouTube: ''Don't call me a liar, pal, that's what you do all the time,'' says O'Reilly; ''This is not your show, so you can't cut offmy mic,'' says Krugman. Judging by their expressions, I was glad Tim Russert (6- 3-) was there in the studio at the time to protect Krugman (5- 7-) (O'Reilly stands 6- 4-). Conservative pundits dislike both economists, but pretty much leave Stiglitz alone.Krugman makes it a point to stay out of government affairs. Stiglitz does just the opposite, and he sometimes gets burned. Stiglitz was part of Bill Clinton's Council of Economic Advisers and was Chief Economist for the World Bank. After much criticism of the way the International Monetary Fund (IMF) conducted lending to developing countries, he was pretty much fired from the World Bank. Comparing the two, you would have to say that Stiglitz is more the bleeding heart, while Krugman says that what he dislikes most is the dishonesty he sees in political-economic discourse. Both are champions of the common man.Since Stiglitz can make the very valid claim for being ''an insanely great economist,'' most everything he says in his books should be taken seriously. There are some real gems in this book. I especially like the perspective he lends to some of the more peculiar things that happened before, during, and after the financial crisis. People hear about these things in the news from some announcer who makes them sound like just more news-bites, but they are, after all, unprecedented (and largely absurd). Take ''robo-signing'' for instance (page 198).WHAT GOES FOR NEWSRobo-signing was part of what happened during the foreclosure process after the massive numbers of defaults of subprime mortgages. Big banks intentionally did not follow mandated law. Apart from ignoring debtors' rights, an ensuing mess followed. Robo-signing was nothing less than a blatant attempt at rewriting property law, and resulted in lying to the courts about the state of each property's title, literally hundreds of times. No bank officer was charged with a crime. By contrast, the savings and loan crisis of the 1980s led to 829 individual convictions and 650 prison sentences. Nowadays the big banks just pay fines as part of settlements where they admit no guilt, and it's just part of doing business.Take algorithmic or ''flash'' trading in the stock exchanges (page 164). These are buys and sales made in nanoseconds on the basis of extracting information from the patterns of prices and trades. Nothing like real information gathered through market research on an industry, or on a firm in a certain industry, backs up these trades. But traders swear that ''price discovery'' is happening this way, and that all this backs up the efficient markets model. So on May 6, 2010 stock prices plummeted to a point where the Dow Jones temporarily lost 10% of its value. There are reasons to believe that these trades ''make markets not just more volatile but also less 'informative' '' (page 166). Still, the talk on the street is all about efficient markets (echoing Alan Greenspan's failures at the Federal Reserve).Take failed privatizations. When electric power in California was liberalized and Enron manipulated prices and public power to its advantage, this was a story about the company's accounting practices, not about privatizing something that had no business being privatized. …

The Price of Inequality: How Today's Divided Society Endangers Our Future

Latin America’s bold fiscal policy reaction to the global financial crisis was hailed as a sign that the region had finally overcome its procyclical fiscal past. However, most countries of the region have not yet rebuilt their fiscal space, despite buoyant commodity revenues and relatively strong growth in the aftermath of the crisis. Using the experience of Brazil, Chile, Colombia, Mexico, Peru, and Uruguay, this paper examines the lessons and legacies of the crisis by addressing the following questions, among others: How much did the 2009 fiscal stimulus help growth? What shortcomings were revealed in the fiscal policy frameworks? What institutional reforms are now needed to provide enduring anchors for fiscal policy? How much rebuilding of buffers is needed going forward?

Fiscal Policy in Latin America; Lessons and Legacies of the Global Financial Crisis

This paper identifies and documents the properties of output gap recessions and recoveries in the Middle East, North Africa, and Pakistan (MENAP) during the 1980 to 2008 period. It goes on to investigate the key determinants of the recoveries. The duration of MENAP countries’ recessions and recoveries has increased from the 1990s to the 2000s. MENAP hydrocarbon exporting countries’ recessions were on average more pronounced in the 2000s, and hydrocarbon importing countries’ recessions milder. Fiscal policy is found to have played a key role during the recoveries to potential output, although with weaker effects for MENAP countries that are more open to trade. Monetary policy is found to have been less effective. This is likely to be related to the fact that many of the MENAP countries have fixed exchange rate regimes and hence have limited room for active monetary policy.

https://www.imf.org/-/media/Websites/IMF/imported-full-text-pdf/external/pubs/ft/wp/2010/_wp10122.ashx

Recoveries in the Middle East, North Africa, and Pakistan : Have Macroeconomic Policies Been Effective?

Automated seismic event location combining waveform stacking and relative location techniques: An application to geothermal and volcanic environments

The large economic costs of full-blown lockdowns in response to COVID-19 outbreaks, coupled with heterogeneous mortality rates across age groups, led to question non-discriminatory containment measures. In this paper we provide an assessment of the targeted approach to containment. We propose a SIR-macro model that allows for heterogeneous agents in terms of mortality rates and contact rates, and in which the government optimally bans people from working. We find that under a targeted policy, the optimal containment reaches a larger portion of the population than under a blanket policy and is held in place for longer. Compared to a blanket policy, a targeted approach results in a smaller death count. Yet, it is not a panacea: the recession is larger under such approach as the containment policy applies to a larger fraction of people, remains in place for longer, and herd immunity is achieved later. Moreover, we find that increased interactions between low- and high-risk individuals effectively reduce the benefits of a targeted approach to containment. © 2021 Walter de Gruyter GmbH, Berlin/Boston 2021.

https://www.econstor.eu/bitstream/10419/228506/1/GLO-DP-0752.pdf

Assessing Targeted Containment Policies to Fight COVID-19

Incorrectly oriented geophysical sensors affect data analysis procedures, which can lead to errors in results and interpretations. These problems generally occur in applications, in which the orientation of the sensor cannot be actively controlled and is not known a priori. Common examples are sensors deployed in borehole installations or on the seafloor. We introduce two methods to optimally correct data sets from misaligned two- and three-component sensors. Firstly, we demonstrate how a set of multiple two-component sensors can be re-oriented in a single step calculation. In the second part, we introduce a quaternion-based analytical method for the calculation of the optimal re-orientation of three-component sensors. A common approach to the re-orientation of three-component data is to assume that the vertical axis does not have to be corrected during the processing. We show, that this approximation can lead to significant deviations between re-oriented data and original data. Therefore, the estimation of not only an optimal rotation angle, but also the rotation axis can help to mitigate a systematic source of error in the processing of geophysical data.

/pdf/optimal-correction-of-data-from-misoriented-multi-component-1yme9jg82g.pdf

Francesco Grigoli

Papers

Fiscal Policy in Latin America; Lessons and Legacies of the Global Financial Crisis

Recoveries in the Middle East, North Africa, and Pakistan : Have Macroeconomic Policies Been Effective?

Automated seismic event location combining waveform stacking and relative location techniques: An application to geothermal and volcanic environments

Assessing Targeted Containment Policies to Fight COVID-19

Optimal correction of data from misoriented multi-component geophysical sensors