U.S. Macro Policies and Global Economic Challenges

East Asian Economic Review

Hiro Ito¹  Joshua Aizenman² 

[1] Portland State University;University of Southern California;

关键词: debt overhang;    emerging markets;    macro policies;    secular stagnation;    global currencies;    global stability;   

DOI  :  

来源: DOAJ

【 摘 要 】

This paper overviews different exit strategies for the U.S. from the debt-overhang, and analyses their implications for emerging markets and global stability. These strategies are discussed in the context of the debates about secular-stagnation versus debt-overhang, the fiscal theory of the price level, the size of fiscal multipliers, prospects for a multipolar currency system, and historical case studies. We conclude that the reallocation of U.S. fiscal efforts towards infrastructure investment aiming at boosting growth, followed by a gradual tax increase, aiming at reaching a modest primary fiscal surplus over time are akin to an upfront investment in greater long-term global stability. Such a trajectory may solidify the viability and credibility of the U.S. dollar as a global anchor, thereby stabilizing Emerging Markets economies and global growth.

【 授权许可】

Unknown