Tag Archives: growth

De Lacy on the Carbon Tax

“Keith De Lacy, chair­man of takeover tar­get Macarthur Coal, said yes­ter­day the absence of a viable alter­na­tive to coal to fuel Asia’s eco­nomic growth would main­tain high prices world­wide and pro­tect min­ers against the lat­est “attack” by the Labor gov­ern­ment on the indus­try.” Extract from The Aus­tralian Read the rest of the inter­view. De Lacy, …

July 13, 2011 – 9:16 am | By pwg | Posted in Resources | Tagged , | Comments (0)

Krugman’s take on protection

It seems Krug­man will say any­thing to score a point. He wants to argue that insuf­fi­cient demand (unem­ploy­ment) is a prob­lem and that redis­tri­b­u­tion (trade taxes) is not. “…the attempt to place blame for the Depres­sion on pro­tec­tion­ism is a sort of Noble Lie, an attempt to scare peo­ple into trade pol­icy that’s good for other …

July 13, 2010 – 10:10 am | By pwg | Posted in Trade | Tagged , , | Comments (0)

A whiff of luddism

Ken Rogoff—the Cas­san­dra of the finan­cial mar­kets crisis—insinuates a moral les­son from a another tech­ni­cal dis­as­ter with­out, how­ever, actu­ally defin­ing one. “If ever there were a wake-up call for West­ern soci­ety to rethink its depen­dence on ever-accelerating tech­no­log­i­cal inno­va­tion for ever-expanding fuel con­sump­tion, surely the BP oil spill should be it. Even China, with its ‘boom …

June 2, 2010 – 9:40 am | By pwg | Posted in Resources | Tagged , | Comments (0)

Market and PPP measures of GDP

Source: IMF data mapperSource: IMF data mapper

In com­ments on the pre­vi­ous post, Ian Cas­tles AO, the for­mer Aus­tralian Sta­tis­ti­cian, notes that the World Bank and IMF cre­ate con­fu­sion in their reports by mixed use of market-exchange-rate (MER) and purchasing-power-parity (PPP) bases for esti­mat­ing out­put and growth. Sim­ply, using mar­ket exchange rates to com­pare the value of out­put among coun­tries over-estimates the size of devel­oped economies and under-estimates the size of devel­op­ing economies. This con­fu­sion affects their analy­ses of, among other things, trade data.

The charts (click the thumb­nails), taken from the two sets of data pre­pared by the IMF, show the dra­matic dif­fer­ence between MER and PPP bases for com­par­ing out­put and growth. Using the PPP basis for com­par­i­son, devel­op­ing coun­tries’ economies are much larger in rela­tion to devel­oped economies and pro­jected to ‘close the gap’ some­time after 2015 (take the IMF pro­jec­tions with a grain of salt: they’re just ‘straight line’ exten­sions of cur­rent pat­terns of growth). The only dif­fer­ence between the two charts is the iden­ti­fi­ca­tion of China. Note that using a PPP basis for com­par­i­son, China appears less dom­i­nant in the devel­op­ing coun­try group.

July 14, 2009 – 11:56 am | By pwg | Posted in Trade | Tagged , , , , | Comments (1)

Thailand’s spiral

Sad, brief eco­nomic history:

“One of the rea­sons Thai­land has failed to flour­ish as once pre­dicted is that its growth was built on weaker foun­da­tions than sup­posed.” Extract from David Pilling in the Finan­cial Times (subscription)

But is there such a thing as ‘weak’ or ‘strong’ foun­da­tions for macro­eco­nomic growth?

April 30, 2009 – 8:56 am | By pwg | Posted in Resources | Tagged , | Comments (0)

Costs and benefits of trade

Asian exports have grown rapidly

It’s a shame that even the Finan­cial Times has joined the cho­rus of alarm about the recent plunge in trade volumes.

“[The IMF] expects (Asian) regional growth of just 2.7 per cent, a frac­tion of the 9 per cent achieved in 2007 and a per­cent­age point lower even than it man­aged dur­ing its own finan­cial cri­sis a decade ago. That cri­sis was largely self-inflicted, the prod­uct of an overde­pen­dence on fickle flows of for­eign finance. This time, the region’s bal­ance sheets are in bet­ter shape and the cri­sis began else­where. So why does Asia appear set for an even harder fall? The answer is trade.” extract from Finan­cial Times

Eco­nomic inte­gra­tion has costs as well as ben­e­fits. That’s not a sur­prise to any­one. So does hav­ing neigh­bors, chil­dren and a bank account. So what?

February 10, 2009 – 12:58 pm | By pwg | Posted in Trade | Tagged , , | Comments (0)

World trade: it’s not the 1930s

Some ini­tial reac­tions of gov­ern­ments to the prospect of a dra­matic down­turn in world trade and pro­duc­tion uncan­nily echo events of eighty years ago. Think of the ‘no-new-protection’ pledge at the Novem­ber meet­ing of the ‘G-20′ group of gov­ern­ments in Wash­ing­ton. There was a sim­i­lar event in 1929:

“In Sep­tem­ber 1929, the League of Nations rec­om­mended that mem­ber coun­tries agree to a “tar­iff truce” in which tar­iff lev­els would not increase for two to three years. A con­fer­ence was con­vened five months later for this pur­pose, but it broke down as cen­tral and east­ern Euro­pean coun­tries embraced inten­sive agricul– tural pro­tec­tion­ism in the face of a sharp decline in com­mod­ity prices. A few coun­tries rat­i­fied the tariff-truce pledge, but it had lit­tle effect on sub­se­quent pol­icy.” extract from Doug Irwin: Trade pol­icy in 2008: Great Depres­sion redux? (Chap­ter from a book of short essays: see over the fold for the link)

Irwin—who spe­cial­izes in the pale­on­tol­ogy of the mul­ti­lat­eral trad­ing sys­tem—points out, how­ever, that the dif­fer­ences between the 1930s and the 2010s are more strik­ing than the sim­i­lar­i­ties.

February 2, 2009 – 9:08 am | By pwg | Posted in Trade | Tagged , , , , | Comments (0)