Working Papers

CGS Working Papers provide timely analysis on issues at the intersection of politics and economics.

Doubts About Capital Controls

Doubts About Capital Controls

Author: Francis E. Warnock

China's policy of holding down the value of its currency and monetary easing in the United States have led to large capital inflows into emerging economies. Although consensus in emerging markets has formed around capital controls, Francis E. Warnock challenges their underlying assumptions.

See more in International Finance; Monetary Policy; Global

The Evolving Structure of the American Economy and the Employment Challenge

The Evolving Structure of the American Economy and the Employment Challenge

Authors: A. Michael Spence and Sandile Hlatshwayo

Many low-paying jobs have moved from the United States to rapidly growing markets abroad, and higher-paying jobs may soon follow. While Americans benefit from cheaper goods, employment opportunities have diminished. Policymakers should address this trade-off as a first step toward tackling questions of inequality and economic distribution.

See more in Labor; United States; Industrial Policy

Improving Energy Market Regulation: Domestic and International Issues

Improving Energy Market Regulation: Domestic and International Issues

Author: Daniel P. Ahn

High and volatile energy prices have driven the regulation of commodity financial markets to the forefront of the U.S. and G20 policy agendas. Integrated commodity markets require international policy coordination, but not all domestic and international policy initiatives are equally desirable.

See more in Economics; Oil; Global

How Dangerous Is U.S. Government Debt?

How Dangerous Is U.S. Government Debt?

Author: Francis E. Warnock

The dollar's status as the world's reserve currency has become a facet of U.S. power, allowing the United States to borrow effortlessly and sustain an assertive foreign policy. But the capital inflows associated with the dollar's reserve-currency status have created a vulnerability, too, opening the door to a foreign sell-off of U.S. securities that could drive up U.S. interest rates. In this Center for Geoeconomic Studies Capital Flows Quarterly, Francis E. Warnock argues that a sell-off came close to happening in 2009. How the United States uses this reprieve will affect the nation's ability to borrow for years to come, with broad implications for the sustainability of an active U.S. foreign policy.

See more in Financial Crises; Budget, Debt, and Deficits; United States

Harnessing International Institutions to Address Climate Change

Harnessing International Institutions to Address Climate Change

Authors: Katherine Michonski and Michael A. Levi

Most discussions about using international institutions to address climate change focus narrowly on the work of the United Nations Framework Convention on Climate Change. However, many other international institutions also have a significant role to play in mitigating and adapting to the effects of climate change. This paper examines the existing climate-related efforts and capabilities, as well as the future potential, of a variety of international institutions, including those that deal with environment, energy, and economics. While there are still major shortfalls, the paper argues that there is significant existing institutional capacity to draw from in addressing climate change.

See more in International Organizations and Alliances; Climate Change

The Gloomy Prospects for World Growth

The Gloomy Prospects for World Growth

Author: Steven Dunaway

In this Center for Geoeconomic Studies Working Paper, Steven Dunaway argues that the world economy faces the prospect of a prolonged period of slower growth. Other sources of demand need to be found to take up the slack left by slower U.S. growth. However, the prospects for this do not look good, as none of the other major economies appear inclined to make the necessary changes in policies to deal with their imbalances and raise their demand.

See more in Financial Crises; International Finance

Trade Liberalization: Cordell Hull and the Case for Optimism

Trade Liberalization: Cordell Hull and the Case for Optimism

Author: Douglas A. Irwin

The news that the Doha Round of the World Trade Organization has broken down in Geneva has made many Americans pessimistic about the future of multilateral trade agreements. In this Center for Geoeconomic Studies Working Paper, Douglas A. Irwin makes the case for optimism and argues that the key to advancing the free-trade cause is political leadership of the sort demonstrated by a heroic but near-forgotten figure, the late secretary of state Cordell Hull of Tennessee. Irwin traces Hull’s path through the decades and shows how his legacy lights the way for leaders of both political parties.

See more in United States; Trade

Food Price Inflation: Explanation and Policy Implications

Food Price Inflation: Explanation and Policy Implications

Author: Karen H. Johnson

The sharp run-up in food prices has triggered riots in several countries and threatened to push millions of people below the poverty line. In this Center for Geoeconomic Studies Working Paper, Karen H. Johnson explains the causes and likely future course of food-price inflation and analyzes the implications for central banks, trade negotiators, and agricultural policy.

See more in Food Security; Agricultural Policy; Global

Smart Countries, Foolish Choices

Smart Countries, Foolish Choices

Authors: Amity Shlaes and Gaurav Tiwari

Intuition tells us that oil-rich countries are not friendly to the United States, and that entreprenurial—or “smart”—countries are not endowed with oil. In this Center for Geoeconomic Studies Working Paper, the authors find a triangular relationship between oil wealth, entrepreneurial spirit, and friendliness to the United States. They confirm the idea that “oily” countries are not U.S.-friendly, in contrast to smart countries, which are friendly to the United States and do not have oil. The authors conclude that it is in the U.S. interest to support education and economic diversification in petro-states so those states can become more entrepreneurial and friendly.

See more in Oil; Entrepreneurship; Global