Changes In Economic Policy Research Articles

Economic Policy Changes in the Great Depression of the United States and the Great Depression of COVID-19

Since the COVID-19, the U.S. domestic economy has been hit hard, causing currency devaluation and a dramatic increase in unemployment. Economic policy during the Great Recession and COVID-19 had the impact of stabilizing the economy and saving the unemployment rate. It is of great significance to study the enormous positive and negative effects of these policies on the U.S. and global economies at that time and later. This paper analyzes and contrasts these effects with the support of literature and data. The Fed first changed its stance on rate hikes to cushion economic pressures, and then turned to rate cuts because of escalating trade frictions to sound recession alarms in the market. The spillover effect of U.S. macroeconomic policy adjustment is comprehensive. Affected by the financial hegemony of the United States, not only emerging economies are unable to resist the impact, developed countries are also difficult to escape the 'tail effect'. At present, many countries have government banks in order to avoid devaluation of their currencies, to prevent capital outflows, had to follow the Federal Reserve to make the decision to raise interest rates. The policies aimed at easing have all had a different impact on the U.S. economy and society.

How Sanctions Led to Authoritarian Capitalism in Venezuela

After a deterioration of democratic conditions in Venezuela, in 2017 the United States intensified its sanctions imposed on the regime of Nicolás Maduro. The sanctions failed to topple the regime, but they accelerated the transformation of the Venezuelan economy. To counter the sanctions, Maduro carried out substantive economic policy changes, resulting in the emergence of a neo-patrimonial and authoritarian form of capitalism. In this new model, private ownership is the rule, and economic agents operate for profit. Yet there is frequent state intervention that denies individuals’ fundamental political and economic rights, and the purpose of laws and regulations is ensuring regime survival.

Trajectory of economic development of the Republic of Uzbekistan in the process of digitization

The purpose of the this work is to study the process of digitalization of the economy of Uzbekistan and its impact on the economic development of the country. The digitalization process covers all new sectors of the economy and requires the country to make appropriate changes in economic policy. The Republic of Uzbekistan is also no exception. The country is on the path of reforms and transformations in various areas, and digitalization is one of the main tasks of the national economy. In this regard, it is necessary to conduct a deep analysis of the trajectory of the country's economic development in the process of digitalization, identify key problems and assess their impact on the economic growth and development of Uzbekistan. The article contains the opinions, conclusions and suggestions of the authors on the topic.

Влияние геополитической напряжённости на экономическую активность в России

The purpose of the research is to empirically assess the impact of geopolitical risks and economic policy uncertainty on economic activity in Russia. We implement business and consumer confidence index, shares of foreign trade with BRICS countries and western economies and economic growth rates to describe the domestic activity. We use monthly data ranged January 2010 till December 2021 for econometric modelling. The empirical strategy exploits vector error correction model to estimate the impact of external shocks on Russian economic activity. The results demonstrate that the enhancement of economic policy uncertainty and geopolitical risks do not decrease the Russian producers’ confidence in the short run. However, the consumer expectations are found rather negative in the short and long term. The foreign trade of Russia with western countries significantly decreased over the investigated period, while trade turnover with BRICS countries enhanced. Meanwhile, the dynamics of trade with BRICS partners responds less to the changes in economic policy. Coincidently, geopolitical risks enhanced the trade flows between Russia and BRICS, which in turn promoted the Russian economic growth. The trade dynamics with European Union and United States shows a negative trend affected by external factors. However, it has minor effect on Russian economy in the long run. In this respect, we find evidence that economic activity in Russia is subject to external shocks. At the same time, the economy of Russian Federation can adopt to economic policy uncertainty and geopolitical risks, therefore their negative influence in the short run smooth in the long-term perspective

Korea's Economic Policy Changes: Reflected in the Corporate Financial Indicators During the Last 60 Years

Korea's Economic Policy Changes: Reflected in the Corporate Financial Indicators During the Last 60 Years

The Collapse of the New Orde Regime Resulted in Changes in Indonesia's Economic Policy

The reform era or the post-Suharto era in Indonesia began in 1998, to be precise when President Soeharto resigned on May 21 1998 and was replaced by the then vice president, BJ Habibie . This period was founded bya more open socio-political environment. Issues during this period included the push for democracy and a stronger civilian government, elements of the military trying to maintain influence, growing Islamism in politics and society in general, and demands for greater regional autonomy . The reform process resulted in a higher degree of freedom of speech , in contrast to the widespread censorship during the New Order . As a result, political debate has become more open in the mass media and artistic expression has increased. Events that have shaped Indonesia in this period include a series of terrorist incidents (including the 2002 Bali bombings ) and the 2004 Indian Ocean earthquake and tsunami . Using the knife of deconstruction of critical legal theory and socio-legal methodology with statutory, historical, conceptual and legal political economy approaches, three questions are raised, firstly the role of law in the market reform agenda which underlies the idea of limiting the role of the state in the economy; second, how is the role of the state in the economy being debated in the MPR and; third, what are the implications of the market reform agenda for the results of changes to the economic constitution.

A Small Open Economy DSGE Model for Pakistan

In recent years there has been a growing interest in academics, international policy institutions and central banks1 in developing small-to-medium, even large-scale, open economy macroeconomic models called Dynamic Stochastic General Equilibrium (DSGE) models based on new-Keynesian framework.2 The term DSGE was originally used by Kydland and Prescott (1982) in their seminal contribution on Real Business Cycle (RBC) model. The RBC model is based on neoclassical framework with micro-founded optimisation behaviour of economic agents with flexible prices. One of the critical assumptions of this model is that fluctuations of real quantities are caused by real shock only; that is, only stochastic technology or government spending shocks play their role. Later research in DSGE models however included Keynesian short-run macroeconomic features (called nominal rigidities), such as Calvo (1983) type staggered pricing behaviour and Taylor (1980) type wage contracts. Hence this new DSGE modeling framework labeled as new-neoclassical synthesis or new-Keynesian modeling paradigm. 3 This new approach combines micro-foundations of both households and firms optimisation problems and with a large collection of both nominal and real (price/wage) rigidities that provide plausible short-run dynamic macroeconomic fluctuations with a fully articulated description of the monetary policy transmission mechanism; see, for instance, Christiano, et al. (2005) and Smets and Wouters (2003). The key advantage of modern DSGE models, over traditional reduce form macroeconomic models, is that the structural interpretation of their parameters allows to overcome the famous Lucas critique (1976).4 Traditional models contained equations linking variables of interest of explanatory factors such as economic policy variables. One of the uses of these models was therefore to examine how a change in economic policy affected these variables of interest, other things being equal. In using DSGE models for practical purposes and to recommend how central banks and policy institutions should react to the short-run fluctuations, it is necessary to first examine the possible sources,5 as well as to evaluate the degree of nominal and real rigidities present in the economy. In advanced economies, like US and EURO area, it is easy to determine the degree of nominal and real rigidities as these economies are fully documented. In developing economies like Pakistan, where most of economic activities are un-documented (also labeled as informal economy, black economy, or underground economy), it is very difficult to determine the exact degree of nominal and real rigidities present in the economy. However, one can approximate results using own judgments and through well defined survey based methods

Governance and Income Inequality

Major problems of developing countries are unequal income distribution and low growth rate, which affect their welfare aspects. It was implicitly assumed that whenever we achieve target of higher growth rate, benefit of growth would automatically trickle down to the poor. History of developing countries shows that the rich benefited more than the poor as evidenced by rising income inequality during the period of higher economic growth. The economic policy changes are often triggered by the logic of low level of equilibrium of output level, employment and income distribution. To overcome this low level of equilibrium trap, government often adopt polices so as to achieve high level of income and employment growth and development, and equitable income distribution. Coherent policy instruments are essential to meet these policy targets. Impact of any macro economic policy has been examined by studying its impact on economic growth and income distribution. In recent years polices have been directed toward reducing the level of poverty and inequality through raising quality of life in society by providing efficient and effective governance. This new economic philosophy has resulted in a massive change in the policy orientation of countries; the priority is now centred on issue of governance and focus is now shifted towards a qualitative nature of its growth and development. According to Sen (1983), the realisation of human capabilities, that enlarge the range of human choices, is essential for a broader notion and measure of economic well-being. The institutional frame work is then considered as one of the essential elements for translating growth and well-being into a sustainable process.

Tracking North Korean economic transformation and trends in economic research

If North Korea's economic transformation has been largely informal and contested at the level of the state, to what extent is North Korea's economic transformation reflected in North Korean economic research? In this article, we analyze a dataset of North Korean domestic journal articles on economics from 2000 to 2019. We trace trends over time in the topics covered by economics research in North Korea, and compare them with formal changes in North Korean economic policy under Kim Jong-il and, particularly, Kim Jong-un. Research in potentially economic transformation-related topics tends to increase in response to formal economic policy changes. Kim Jong-un's rule has seen the development of an integrated economic research networks, and a shift to articles that have focused on the practicalities of implementing policies. We close with implications for unification and engagement.

Legal Politics of Environmental Licensing Governance After Job Creation Law

The validation of the Job Creation Law in Indonesia brought many fundamental changes in economic policy, including environmental licensing. It is because of a fundamental legal political changes that more directed to the ease of doing business and investing compared to the environmental conservation, by changing the terminology of environmental licensing to environmental approval. This paper aims to analyze the legal politics of environmental licensing governance after the Job Creation Act. The results of this study indicated that there are changes in legal politics in environmental licensing governance after the Job Creation Law which had implications for the business licensing system. So, a legal mapping is needed regarding to the concept of environmental licensing in the Job Creation Act. The findings of this paper are the ideal concept of environmental licensing based on the 1945 Constitution of the Republic of Indonesia.

China’s Gridded Manufacturing Dataset

The growth of the manufacturing industry is the engine of rapid economic growth in developing regions. Characterizing the geographical distribution of manufacturing firms is critically important for scientists and policymakers. However, data on the manufacturing industry used in previous studies either have a low spatial resolution (or fuzzy classification) or high-resolution information is lacking. Here, we propose a map point-of-interest classification method based on machine learning technology and build a dataset of the distribution of Chinese manufacturing firms called the Gridded Manufacturing Dataset. This dataset includes the number and type of manufacturing firms at a 0.01° latitude by 0.01° longitude scale. It includes all manufacturing firms (classified into seven categories) in China in 2015 (4.56 million) and 2019 (6.19 million). This dataset can be used to characterize temporal and spatial patterns in the distribution of manufacturing firms as well as reveal the mechanisms underlying the development of the manufacturing industry and changes in regional economic policies.

Foreign economic cooperation and development of the Republic of Korea through the conclusion of free trade agreements

The article discusses changes in the foreign economic policy of the Republic of Korea in connection with the deterioration of international trade at the beginning of the XXI century. The direct motive for changing the foreign economic policy of the Republic of Korea is the decline in the role of the WTO as a multilateral trading partner. On the other hand, FTA, based on economic cooperation between the two countries, is becoming a new model for economic development and cooperation in the XXI century. Bilateral negotiations are more likely to end than multilateral ones, because they are actively conducted in accordance with the interests of two countries. Therefore, free trade agreements (FTAs) are becoming the main direction of the economic policy of the Korea’s government to adapt foreign economic policy and overcome the negative trend of global economic development. An FTA has various economic effects, such as the development of trade between two countries, improving the efficiency of resource allocation, reviving investment between two countries and stimulating economic growth. In accordance with this situation, the Republic of Korea justifies the relevance of trade and economic cooperation between two countries through the conclusion of an FTA as a means of implementing an active foreign economic policy. The Republic of Korea has become an opportunity to introduce an advanced economic structure through the signing of free trade agreements with advanced countries. On the other hand, it served as an opportunity to strengthen economic cooperation through the signing of free trade agreements with developing countries. For this reason, the experience of the foreign economic policy of the Republic of Korea can serve as a good example for the economic development of developing countries.

The Nonlinear Model of Intersectoral Linkages of Kazakhstan for Macroeconomic Decision-Making Processes in Sustainable Supply Chain Management

We provide a nonlinear model of intersectoral balance with constant elasticity of substitution (CES) production functions of industries and CES utility function of final consumer for the study of intersectoral linkages in the Kazakhstan economy. The model is formalized in terms of the primal problem of resource allocation and the corresponding Fenchel dual problem which solution gives costs of inputs of industries in a supply network. We identify the model with the actual data of the Input-Output tables of Kazakhstan and estimate the elasticity of substitution of production factors for the aggregated industry complexes. With the help of developed framework, we evaluate the inter-industry financial flows in the aggregated supply network for the period 2013–2020 and compare the results with the actual data of Kazakhstan. The developed framework can be used to support decision-making processes in sustainable supply chain management in a situation of the government economic policy change and external shocks. Using the developed framework, we evaluate the risks for Kazakhstan’s supply chains in scenario of sharp weakening of the national currency.

The Clémentel moment: the reform of 1918 and the beginnings of regional economic planning in France

Abstract In 1918 Clémentel, the ministre du Commerce organized the 149 chambers of commerce in France into regional groupings. He hoped they would be effective partners with the government in the economic development of their regions. Clémentel’s reform should be seen not just as a manifestation of economic regionalism but also as part of a new approach to managing the French economy which made widespread use of corporate bodies as intermediaries between the government and private interests. The article shows how the reform emerged from pre-war debates on economic regionalism and also from wartime planning for the post-First World War economy. It describes how Clémentel encouraged a number of intermediary corporate bodies, including chambers of commerce, to play a significant role in economic affairs. Based on original research it analyses the initiatives these bodies took in transport, power generation and technical education after the war in many regions of France. This economic regionalism was part of a major institutional change in economic policy making. It was also the precursor of the regionalization of economic planning after the Second World War.

GELİŞME EKONOMİSİ POLİTİKALARINDA SON YÜZYILDA YAŞANAN DEĞİŞİM VE GÜNÜMÜZDE ÖNE ÇIKAN HUSUSLAR

Gelişme ekonomisi politikaları, başka bir ifadeyle büyüme başta olmak üzere ülkelerin iktisadi ve sosyal kalkınma amaçlı politika tercihleri, esasen İkinci Dünya savaşı sonrasında olmak üzere, geçmişten günümüze her dönemin şartları ve bu dönemlerde öne çıkan iktisat düşünce iklimi çerçevesinde şekillenmektedir. Bu çalışmanın amacı, son yüzyılda iktisat politikalarında, daha tanımlı ifadeyle gelişme ekonomisi politikalarında yaşanan değişimin incelenmesi ve bu süreçte yaşanan temel politika değişikliklerinin altında yatan hususların irdelenmesidir. Ayrıca ulusal ve uluslararası düzeyde karşılaşılan sorunlar ve yaşanılan eşitsizliklerin de etkisiyle şekillenen günümüz gelişme ekonomisi politikalarında öne çıkan hususlar ele alınmaktadır. Çalışmada yöntem olarak kronolojik bir süreç izlenmekte, temel politika değişimi ya da tercihlerinin neden ve sonuç bağlantılarının kurulmasına çalışılmaktadır. Günümüz gelişme ekonomisi politikalarında sürdürülebilir kalkınma ve büyümenin kapsayıcılık niteliğinin güçlendirilmesi önem kazanmaktadır. Ekonomide rekabet gücünün artırılması, değişen işgücü talebine uygun mesleki beceri kazanımı ve etkin sosyal koruma sistemlerine olan ihtiyaç artmaktadır. 1960’lı yılların planlı kalkınma modellerinden farklı olmakla birlikte, ekonomilerin işleyişinde plan, program ve stratejilere dayalı süreç işletiminde artış yaşanmaktadır. Gelinen noktada, 1980 sonrası uygulanan etkinlik, büyüme ve istikrar esaslı politikalar yerine iktisadi, sosyal ve çevresel konularda daha dengeli bir gelişme sürecinin amaçlandığı görülmektedir.

The Microcosmic Mechanism and Empirical Test of Uncertainty on the Non-Linear Fluctuation of Chinese Grain Prices-Based on the Perspective of Global Economic Policy Uncertainty

The dramatic fluctuations in grain prices and the threat to grain security caused by global economic policy uncertainty have been a social concern and a challenging area for price management authorities to regulate. Based on general equilibrium analysis in microeconomics, this paper constructs a mathematical model of the impact of global economic policy uncertainty on grain price fluctuation. It then examines the micro mechanism of non-linear grain price fluctuation under the dominant market mechanism and measures the non-linear shock effect of global economic policy uncertainty on grain prices using a threshold regression model. The results show that soybean and corn prices are subject to a two-zone fluctuation pattern due to global economic policy uncertainty. The impact has significant non-linear characteristics and is significantly greater in the high zone than that in the low zone. Accordingly, this paper offers government departments advice on better regulating and managing the market supply and demand and smoothing out sharp fluctuations in grain prices caused by changes in global economic policies.

Constructing a neoliberal exclusionary state: the role of far-right populism in economic policy change in post-war Austria

How and to what extent does far-right populism impact the nation-specific implementation of neoliberal policymaking? While scholarship convincingly demonstrated the importance of ideas and the political agents propagating neoliberal ideas in policy paradigmatic shifts, there is little investigation of the role that far-right populists play in economic policy change. Exploring the ideational power and impact of far-right populism in neoliberal policymaking provides an important insight into how neoliberal political economies enact nationalist cultural exclusion. The paper traces the process through which the Austrian Freedom Party’s ideational trajectory evolved in post-war Austria and how it impacted the political mainstream. The analysis draws from the party’s discourse in manifestos, interviews, and other publications in the period 1956–2006. The results show how the specific far-right populist actor, the Austrian Freedom Party, played a significant role in rendering neoliberal ideas viable as policy option early on and ultimately constructing the neoliberal exclusionary state. By empirically showcasing how political actors from the fringes of the political spectrum can impact economic policy change, this presents an important contribution to the study of paradigm shifts, which predominantly focused on major national political actors. In light of the recent rise of far-right populism in Europe and beyond, this raises important questions for the continuity and change of the global paradigmatic dominance of neoliberalism.

О последствиях событийного экономического кризиса 2020 г. на национальном и региональном уровнях

The article presents an analysis of specific results, the most significant trends in the development of the Russian economy in 2020, caused by the spread of coronavirus infection. An assessment of social and economic indicators for 2020 compared to average values for the previous years 2017–2019 is given. The impact of an increase in the COVID-19 incidence on the demographic situation, introduction of quarantine restrictions on the regional economy of the Karachay-Cherkess Republic, a federal entity of the North Caucasian Federal District, is shown. Obviously, the degree of manifestation of the economic crisis depends on the level of social and economic development of the regions of Russia. The authors note the characteristic features of the crisis generated by the pandemic, which must be taken into account when developing anti-crisis policy, as well as economic policy at the stage of overcoming the crisis. Some enterprises found themselves on the verge of bankruptcy not as a result of their own inefficient activities, not because of errors in state regulation of economic development, but because of the closure of borders and the introduction of lockdowns. The recession threatens to turn into a depression. Year 2020 showed the importance of timely adaptation to a changing reality, the need to take emergency and extraordinary medical, economic, social measures to mitigate the impact of the pandemic. In the course of the study, the features of changes in the state economic policy caused by crisis phenomena are highlighted. The crisis had an impact on the strategic goals of regional development, contributed to a change of fiscal and credit policies, changed the ways of coordination between government and business, and activated approaches and models of anti-crisis management. The recovery growth of the country’s economy with subsequent of sustainable development, the combination of anti-crisis measures with the implementation of structural modernization tasks will prevent the deterioration of the economic situation and overcome quickly the negative consequences of the crisis.

Can gold or silver be used as a hedge against policy uncertainty and COVID-19 in the Chinese market?

PurposeThe purpose of this study is to present evidence as to whether the use of gold or silver can be justified as an asset to hedge against policy uncertainty and COVID-19 in the Chinese market.Design/methodology/approachBy using a GARCH model with a generalized error distribution (GED), this study specifies that the gold (or silver) return is a function of a set of economic and uncertainty variables, which include volatility from interest rate innovation, a change in economic policy uncertainty (EPU), a change in geopolitical risk (GPR) and volatility due to pandemic diseases, while controlling for stock market returns, inflation rates, economic growth and the Chinese currency value.FindingsThis study employs monthly data of gold and silver prices over the period from January 2002 to August 2021 to examine hedging behavior. Estimated results show that the gold return is positively correlated to the stock return and a rise in uncertainty from economic policy innovation, geopolitical risk, volatility due to US interest rate innovation as well as COVID-19 infection. This result suggests that gold cannot be used to hedge against a stock market decline, but can be used to hedge against uncertainty in general. However, the silver return only responds positively to a rise in uncertainty from the inflation rate and geopolitical risk. Evidence shows that silver returns are negatively correlated with stock returns, and display hedging characteristics. However, the evidence lacks statistically significance during the COVID-19 period, suggesting that the role of silver as a safe-haven asset against stock market turmoil is weak for this time period.Research limitations/implicationsMore general nonlinear specifications can be developed. The tests may include different measures of uncertainty that interact with each other or with the lagged error terms. An implication of the model is that gold can be used to hedge against a broad range of uncertainties for economic policy change, political risk and/or a pandemic. However, the use of gold as an asset to hedge against a stock downturn in Chinese market should be done with caution.Practical implicationsThis study has important policy implications as regards a choice in assets in formatting a portfolio to hedge against uncertainty. Specifically, this study presents empirical evidence on gold and silver return behavior and finds that gold returns respond positively to heightened uncertainty. Thus, gold is a good asset to hedge against uncertainty arising from policy innovations and infectious disease uncertainty.Social implicationsThis paper provides insightful information on the choice of assets toward hedging against risk in the uncertainty market conditions. It provides information to investors and policy makers to use gold price movements as a signal for detecting the arrival of uncertainty. This study also provides information for demanding a risk premium for infectious disease.Originality/valueThis study empirically analyzes and verifies the role that gold serves as a safe haven asset to hedge against uncertainty in the Chinese market. This paper contributes to the literature by presenting evidence of risk/uncertainty premiums for holding gold against various sources of uncertainty such as economic policy uncertainty, geopolitical risk and equity market volatility due to US interest rate innovation and/or COVID-19. This study finds evidence that supports the use of a nonlinear specification, which demonstrates the interaction of uncertainty with the lagged change of infectious disease and helps to explain the gold/silver return behavior. Further, evidence shows that the gold return is positively correlated to the stock return. This finding contrasts with evidence in the US market. However, silver returns are negatively correlated with stock returns, but this correlation becomes insignificant during the period of COVID-19.

GEOGRAPHY OF NEOLIBERALISM AND SPATIAL FIX

This paper emphasizes the consequences of economic inequality, the roots of which lie at the heart of capitalism. It was explained by Marx (1867), and a modern interpretation was offered by Harvey (1982, 1985, 1987, 2013b) through the term spatial fix, which connects the development of capitalism and urbanization. In this global process, inequalities arise that can be illustrated numerically: the net worth of the world's 358 wealthiest people in 1996 was equal to the total income of the poorest, which makes up 45% of the world's population or 2.3 billion people. This fact of economic inequality, most convincingly written about by Piketty (2016) and Chancel (2020), became even more critical during the Covid-19 pandemic. The gap between the richest and the poorest widened. The period in which several significant changes in global economic policy took place was called neoliberalism (Harvey, 1989, 2013a; Dušanić, 2016) and led to the establishment of a new economic system that significantly determined the further directions of geography. Understanding these processes implies an interactive approach to their study because the capital/labor relationship defines the global framework for developing urbanization and demography, and thus geography (Mutabdžija, 2020, 2021).