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The COVID-19 pandemic is an unprecedented event that has shocked economies worldwide, propelling large-scale adaptation of expansionary policies. This paper examines how, specifically in the scope of developed countries, key economic indicators such as tax revenue and burden, labor force participation rate, and federal budget have been impacted by the pandemic. The specific nations examined in the paper include the United States of America (USA), Japan, Germany, France, and the United Kingdom (UK). The article reveals that tax revenue had fallen at a rate similar to the GDP, and a redistribution of the tax burden has also occurred to some extent. Simultaneously, a fall in the labor force participation rate and increased government deficit were observed. This observation is primarily consistent across all five countries sampled. [ABSTRACT FROM AUTHOR]

Dunne, Smith, and Willenbockel (2005) argue that the mainstream growth literature has not found military spending to be a significant determinant of economic growth, yet much of the defense economics literature has noted significant effects. This paper revisits this issue by using a DSGE-VAR approach, combining both theoretical and empirical methods. We present that the DSGE approach (estimated with the Bayesian technique) and the Bayesian VAR with the Minnesota Prior both lead to worse in-sample fit than our proposed DSGE-VAR framework. The DSGE-VAR approach reveals that a positive military spending shock boosts the U.S. economy, increasing per capita real GDP growth, consumption, inflation and interest rate. Our results are robust to alternative model specifications. Future investigations such as exploring an optimal military spending policy could adopt the approach in this paper to determine the best model -- empirical, theoretical, or a combination of the two. [ABSTRACT FROM AUTHOR]

One of the notable macroeconomic developments of the last two decades has been the apparent decline in the so-called neutral real rate of interest (or r-star). The declining level of r-star has significantly reduced forecasts of the steady-state federal funds rate associated with “normalized” monetary policy. Because a lower steady-state policy rate implies a heightened probability of reaching the effective lower bound on the federal funds rate in the event of an economic downturn, a debate has opened among academics and policymakers about potential changes in Fed’s monetary policy framework that might ameliorate the lower bound problem. This paper introduces a variation of price-level targeting that satisfies a definition of price stability that requires the central bank to keep the price level within a pre-specified percentage of a pre-specified target path for all time horizons into the future. The framework, referred to as bounded price-level targeting, is compared to other proposed frameworks. The paper discusses the conditions under which bounded price-level targeting is consistent with other proposals. [ABSTRACT FROM AUTHOR]

Immigration policy is one of the most hotly contested political issues in the United States. In this paper, we evaluate the role of immigration in the U.S. economy. We pose the counterfactual question, “what would happen if net migration to the U.S. were to cease?” Using the REMI PI+ macroeconomic policy analysis model, we set to zero international immigration from 2018 to 2060, and estimate the national- and state-level economic and demographic implications of this change. Our estimates show that, in the absence of immigration, total U.S. employment would peak in 2019, and the U.S. GDP and labor force would decline by 20% through 2060. Per capita income and GDP effects, however, are relatively minor and sensitive to assumptions in labor and capital markets. [ABSTRACT FROM AUTHOR]

While there has been extensive research on the role of income inequality in economic growth, there has been less investigation as to the role of income inequality on economic resilience. This paper addresses the relationship between income inequality and resilience by evaluating the vulnerability of urban counties in the United States entering recession between 2006 and 2010 and tests whether income inequality contributes to their probability of recession survival. A Cox proportional hazards model is used to determine factors contributing toward urban counties' resilience to the external shock of the Great Recession; the research is focused on the relationship between the level of income inequality in a county and its recession risk. It is found that areas with increased income inequality entered recession earlier. [ABSTRACT FROM AUTHOR]

Understanding the nature of structural change and the sources of economic growth of an economy, especially the relative importance of different industries, is essential for policy-making. This paper estimates industry contribution to economic growth in both Canada and the United States. It argues that industry contribution should be evaluated on the basis of the performance of an industry in terms of creating economic value relative to other industries. In particular, it calls for the quantity and the price effects, which is consistent with real GDP in the chained-Fisher index that values the industry more when its price rises and less when its price declines. This is an important departure from the traditional methodologies that consider only quantity effect. This paper shows that the contribution from demand-driven industries is significantly more than the finding based on traditional thinking. [ABSTRACT FROM AUTHOR]

This paper examines the influence of selected indicators of the banking sector (M3 monetary aggregates and bank loans provided to the non-financial private sector) on economic growth (GDP) in the Eurozone, the USA and Japan. Cointegration of these selected indicators of the banking sector has been demonstrated in relation to the development of GDP using the Engle - Granger cointegration test. These tests were applied to selected statistical data from the years 2000 to 2015. The first was to determine the optimum delay using Akaike criteria for all-time series analysed. Then the presence of a unit root was analysed using the Dickey - Fuller test. Based on the test results, time series were excluded which appear to be stationary. If the conditions were met, testing then continued with the Engle - Granger test to detect cointegration relations, which would determine a relationship between selected variables. Based on these tests, it was found that at a significance level of 0.05, no cointegration relationship exists between any of the time series in the countries surveyed. [ABSTRACT FROM AUTHOR]

Since the Asian financial crisis in 1997, Thailand has become highly dependent on exports as the main engine of economic growth. In 2008, the ratio of export to GDP was about 76.5 percent. The global economic crisis triggered by the sub-prime loans debacle in the United States has prompted Thailand to rethink its high dependence on export. This paper examines the options for external and internal economic rebalancing strategies for Thailand. External rebalancing will require Thailand to rely more on regional markets and less on the Western markets for its exports. The paper examines the possibility of promoting greater intra-regional trade and Thailand's regional trade strategies. As for internal rebalancing, the paper emphasizes the need to boost domestic public and private investment in terms of both quantity and quality to narrow the current saving--investment gap, bearing in mind the need to ensure fiscal sustainability. Finally, the paper examines broader rebalancing strategies that will help Thailand to become less dependent on exports. These include the need to (1) improve productivity; (2) increase economic efficiency; (3) deepen the production structure and create new dynamic industries; and (4) generate new growth poles. [ABSTRACT FROM AUTHOR]

Developing Asia has traditionally relied on exports to the United States and other industrialized countries for demand and growth. As a result, the collapse of exports to the United States and other industrialized countries during the 2008-09 global financial crisis has sharply curtailed GDP growth across the region. The emergence of the People's Republic of China (PRC) as a globally influential economic force is fueling hopes that it can supplement the United States as an additional source of demand and growth. The central objective of this paper is to investigate whether exports to the PRC has a significant and positive effect on the GDP of eight developing Asian countries. Although the study's results indicate that exports to the PRC contributed to developing Asian countries' recovery from the global crisis, it is far too early to make well-informed judgments about the PRC's ability to support Asia's growth in the medium and long term. [ABSTRACT FROM AUTHOR]

The key feature of endogenous growth models is that they imply that permanent changes in government policy can have permanent effects on growth rates. In this paper we develop and implement an empirical framework to test this implication. In a regression of growth rates on current and lagged policy variables the sum of the slope coefficients for each policy variable should be nonzero (zero) for endogenous (exogenous) growth models. In our estimation we use time series data spanning up to 100 years for the United States and 160 years for the United Kingdom. We find that the implication for exogenous growth is usually rejected when both a tax variable and a public capital variable are included in the regression; failing to include both variables biases the results in favor of exogenous growth models. Our findings show that it is possible to have endogenous growth even when U.S. and U.K. GDP growth rates appear to be stable over time. We conclude that at the aggregate level, the production function appears to exhibit constant returns to scale in reproducible inputs. [ABSTRACT FROM AUTHOR]

Discussions of impending capital shortage have begun to fall into something of a pattern. Typically, the author begins by examining the share of GNP that needs to be invested in order to meet the requirements of economic growth at more or less our historical rate. He modifies the recent historical GNP ratio of 15 percent for total private investment or of 10.5 percent for business fixed-investment in accordance with a number of fairly obvious new elements—more environmental and health and safety investment, probably less housing investment, perhaps a little less for schools and hospitals. Typically, he finds a modest increase in investment requirements over past investment rates amounting to one-half to one percent of GNP. The author then turns to the supply of savings from households and firms, and notes as a favorable factor that the personal savings ratio of late has risen substantially, or perhaps as an unfavorable one that the personal savings ratio is apt to decline hereafter from present high levels. He further notes that corporate profits have risen substantially over the last year or perhaps that their recent high level involves a significant overstatement owing to inventory profits and underdepreciation. He is apt to end up with a question mark concerning the future net borrowing or lending position of the public sector. My own conclusion from repeated performance of this exercise has been that the Federal budget deficit or surplus is the crucial factor. Anyone who relies on a future Federal surplus as the means of forestalling a capital shortage at full employment has the burden of proof upon himself. Insofar as I have had to modify my views over the last year, it has been to the effect that household and corporate savings look a little more promising than they did earlier, while the outlook for a significant full employment surplus looks a little more dubious. [ABSTRACT FROM AUTHOR]

Debate over the effect of technology and automation on job creation or job destruction has been an ongoing debate in economics for some time. The recent developments in automation and the speed with which machine is replacing labor in some industries has worried many economists (Krugman, 2013, Graetz, G & G Michaels, 2015). While a number of recent studies present evidence on the negative effect of automation on employment by occupations (Oschinski M & R Wyonchi, 2017), none presents empirical evidence on the effect of automation on jobs at the macroeconomics level. This study utilizes the traditional model of the relationship between the real GDP growth and unemployment rate, estimated for US economy in 1962 and publicized as Okun's Law. The relationship implies that a one percent increase in GDP growth above the normal growth of GDP results in .4 percent decrease in unemployment rate. Although the relationship between GDP growth and unemployment rate may be affected by other economic variables in the short-run, a variable that may result in structural change in this relationship in the long-run is technology and its effect on unemployment. Technological advancement may lead to substitution of capital for labor, resulting in less response of GDP growth to unemployment rate than what Okun's law proposed. The main objective of this paper is to test whether such a structural change in the relationship has occurred or not. Using data for the last sixty years for eight industrialized countries, this paper compares the average response of unemployment rate to real GDP growth in three decades of 1955-1985, with the recent three decades of 1986-2015. [ABSTRACT FROM AUTHOR]

In the XIXth century, the British Empire dominated the world economy. In the last century, the United States of America (USA) became the economic superpower of the world. The US-led post-war world economic order had the following two strong pillars: the principle of fixed parities and US dollar standard and the principle of nondiscrimination and free trade. Also, the Bretton Woods institutions clearly expressed the US post-war dominance of the world economic order. A new economic order is going to be set up in the world, dominated by Asia. The paper aims at presenting an analysis of the old world economic order and the birth of a new order. Our methodological approach is based on a literature review. [ABSTRACT FROM AUTHOR]

This paper studies the patterns of government expenditure stimuli among Organisation for Economic Co-operation and Development ( OECD) countries during the Great Recession (2007-2009). Overall, we find that the USA net fiscal stimulus was modest relative to peers, despite it being the epicenter of the crisis, and having access to relatively cheap funding of its twin deficits. Of the 28 countries in the sample, the USA is ranked among the bottom third in terms of the rate of expansion of consolidated government consumption and investment expenditures. Contrary to historical experience, emerging markets had strongly countercyclical policy during the period immediately preceding the Great Recession and the Great Recession itself. Federal unions, emerging markets and countries with very high gross domestic product ( GDP) growth during the pre-recession period saw larger net fiscal stimulus on average than their counterparts. We also find that greater net fiscal stimulus was associated with lower flow costs of general government debt in the same or subsequent period. [ABSTRACT FROM AUTHOR]

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Using simulations projecting Chinese economic growth into the future, this paper first examines when China will overtake the USA to become the largest economy. Demographic changes that affect economic growth are taken into consideration in these projections. China is expected to become number one sometime in the mid-2020s, unless its growth rate of gross domestic product per worker declines dramatically, à la the lost decade of Japan. Next, the paper examines whether China becoming the number one economy will mean its currency, the renminbi (RMB), will become the international key currency. According to the basket currency regressions during the period that Chinese currency was gradually appreciating against the US dollar from July 2005 to August 2008, it is shown that the RMB has already acquired a strong influence on the Asian currencies. This shows that the RMB is fast gaining the status of a regional anchor currency for a possible regional joint float. As the Chinese government proceeds with internationalization of its currency, the RMB is expected to gain in the ranking of other aspects of international currency, such as the store of value and the medium of exchange. [ABSTRACT FROM AUTHOR]

The composition of economic growth can be analyzed in two different ways. In the ‘traditional method’ for the decomposition of GDP growth, total imports are deducted from exports. This approach underestimates the importance of exports for the growth in GDP, and overestimates the importance of domestic expenditure categories. In the alternative methodology proposed in this paper, imports are allocated to all expenditure categories. Although this ‘import-adjusted method’ is more complex than the ‘traditional method’, it has the considerable advantage that the contributions of the expenditure categories to GDP growth provide a better understanding of why GDP growth decelerates or accelerates. The methodology and data requirements for calculating the import content of final demand, and the implications for the decomposition of real GDP growth, are discussed. For six European countries and the United States, the paper shows that applying the alternative methodology provides rather a different economic story. [ABSTRACT FROM AUTHOR]

One of the well-studied areas in development economics is the relationship between Foreign Direct Investment (FDI) and economic growth. Recently, a renewed interest has been observed in growth determinants and externality-led growth, with the advent of endogenous growth theories (Barro, 1991; and Barro and Sala-i-Martin, 1995). Under this framework, it is more plausible to include FDI as one of the determinants of long-run economic growth. The present paper investigates the relationship (long run and short run) between economic growth, FDI and exports for the US economy. To achieve this objective, Johansen maximum likelihood procedure is used. The results show the presence of one cointegrating vector. Further, the results of Bai-Perron test reveal two structural breaks, and that of block exogeneity Wald test show causality running from exports to GDP and FDI, and also from GDP to FDI. [ABSTRACT FROM AUTHOR]

The article presents a reprint of the article "Debt Is a Misstone" by Michael J. Boskin, which appeared in the "Project Syndicate." The author discusses the controversy of the errors on the research of economist Carmen Reinhart and Kenneth Rogoff that focused on the large decline in economic growth associated with the public debt or gross domestic product (GDP). He also mentions the different methods used by economists to analyze the economic condition and fiscal issues in the country.

We examine the relationship between offshoring and the labor market in an occupational choice model of trade and endogenous growth where workers are employed on the basis of their individual skill levels. Trade liberalization leads to offshoring and reduces employment in the manufacturing sector. Displaced workers move into traditional and innovation sectors according to their skill levels, shaping real wages and aggregate productivity in the manufacturing sector. The paper aims to show how inter-sectoral labor market adjustments, highlighted by skill heterogeneity, could be a possible explanation for the simultaneous rise in productivity and reduction in real wages that have coincided with the sharp escalation of offshoring activities in the U.S. manufacturing sector since 2004. ( JEL F16, F23, J24) [ABSTRACT FROM AUTHOR]

This paper studies contribution of capital deepening, technological progress and efficiency improvement to economic growth while focusing on cross-country data, and thus finds itself at the crossroads of growth and development accounting. We take a production frontier approach to growth accounting and choose DEA as the frontier estimation method. To explore the effects that windfall gains from natural resource use have on growth, output data are corrected for pure natural resource rents—part of GDP figures not earned by either labor or capital. Taking into account countries’ natural resources, we find that in the two decades from 1970 to 1990 the average contribution of technological catch-up to per worker output growth was, if anything, negative on the worldwide scale and this trend continued till the mid 1990ies. Analysis of efficiency estimates also shows a possible change over the period of 1970–1990 in the effect of natural resources on country’s performance [ABSTRACT FROM AUTHOR]

This paper presents evidence of a non-linear relationship between real GDP growth and oil price changes for the US economy. We also argue that this non-linearity is not merely due to the use of data from the mid-1980s onwards, as most authors, so far, seem to believe. In fact, we find the existence of non-linearity with the use of data earlier than 1984, and even before 1977. Furthermore, we question that the non-linear transformations of oil prices proposed in the literature are the most appropriate ones for reflecting such non-linearity. [ABSTRACT FROM AUTHOR]

We measure the overall impact of railroad investment on economic development in the antebellum period in the United States using a vector autoregressive approach. Our results can be summarized as follows. First, we find bidirectional causality between railroad infrastructure investment and GDP. Second, we estimate a marginal product of $4.2 for railroad investment which corresponds to a 15.5% rate of return when considering a 10-year lifetime for railroad capital. While about two-thirds of this effect stems from the supply side, short run demand side effects also are substantial. Third, given the low effective tax rates practiced in the 1830s and the magnitude of the effects of railroad investment we estimate, it is very likely that these investments were not self-financing and may, therefore, have contributed to the high levels of public indebtedness observed in the period. [ABSTRACT FROM AUTHOR]

In this paper we present an overview of GDP and productivity growth patterns in OECD countries over the past decade, on the basis of harmonized data. Our evidence suggests that fast‐growing countries generally shared three characteristics: improvements in labour utilization; a generalized enhancement in human capital; and rapid shifts in the composition of physical capital towards information and communication technology (ICT) equipment. Particularly, we show that technological change embodied in new ICT capital goods has been a primary source of output and productivity growth in ICT‐using sectors. The international comparison allows relating growth patterns to institutional and policy indicators, thereby offering some preliminary insights into the potential sources of growth disparities. Cross‐country evidence yields some tentative support to the idea that institutional factors affecting competition in the product market are likely to affect productivity patterns, especially in a period of rapid diffusion of a general‐purpose technology (such as ICT). [ABSTRACT FROM PUBLISHER]

SUMMARY One of the major challenges of empirical tax research is the identification and calculation of appropriate tax data. While there is consensus that average marginal tax rates are most suitable for studying the effects of tax policy on economic growth, because of data limitations the calculation of marginal tax rates has been limited to the USA and the UK. This paper provides calculations of average marginal tax rates for the four Scandinavian countries using the methodologies of Seater (1982, 1985) and Barro and Sahasakul (1983, 1986). Then, by pooling the newly calculated tax rates for the Scandinavian countries with the data for the USA and the UK, we investigate the effects of tax policy shocks on the per capita GDP growth rate. Our results suggest that an increase in average marginal tax rates has a negative impact on economic growth. Employing additive mixed panel models with penalized splines as estimation approach, we show that changes in tax rates have nonlinear effects. Increasing average marginal tax rates turn out to be the most distorting at relatively moderate tax rates. Copyright © 2013 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper assesses the extent of economic growth dependence of a number of East Asian countries on the USA based upon the quarterly data series spanning from the early 1990s. Generally, the empirical results suggest weak links of these economies to the US contrary to a-priori expectations. Only the GDP of Taiwan has a long-run relationship with the USA. Though Granger causal links from the USA to Japan, Malaysia, the Philippines and Taiwan exist, they are projected as weak by the impulse response functions. Co-integration and short-run causal links with the USA are ruled out in the case of China, Hong Kong, South Korea, Singapore and Thailand. Contemporaneous correlations of output growth shocks merely exist between the USA on one hand and Indonesia and Taiwan on the other. Hence, all this would suggest that these East Asian economies are generally in a position to grow quite independently of the USA, barring a global economic crisis. Nevertheless, they should strive for greater resilience by raising domestic consumption so that they need not always count on countercyclical macroeconomic policy measures to provide a buffer against external shocks. [ABSTRACT FROM AUTHOR]

This paper presents estimates of total personal income for every U.S state in 1880, 1890, 1900, and 1910. The series includes new figures for 1890 and 1910, and revisions of Richard Easterlin's (1960) figures for 1880 and 1900 based on recent economic history research. The new estimates allow better examination of U.S. interregional income differences and cyclical behavior of U.S. states' total personal income. [ABSTRACT FROM AUTHOR]

This article first argues that states have not balanced against US unipolar power because the potential balancers do not view the United States as a major threat, because they believe it has benign security-seeking motives, at least with regard to other major powers. This explanation runs counter to the Brooks-Wohlforth argument, which holds that states are not balancing because the magnitude of the United States' power advantage makes balancing essentially infeasible. The second part of the paper challenges the conventional wisdom on the benefits of unipolarity, arguing that the benefits the United States derives from unipolarity are generally overrated. More specifically, US security need not be significantly reduced by growth in China's economy that supports a return to bipolarity. [ABSTRACT FROM AUTHOR]

We study the conditional distribution of GDP growth as a function of economic and financial conditions. Deteriorating financial conditions are associated with an increase in the conditional volatility and a decline in the conditional mean of GDP growth, leading the lower quantiles of GDP growth to vary with financial conditions and the upper quantiles to be stable over time. Upside risks to GDP growth are low in most periods while downside risks increase as financial conditions become tighter. We argue that amplification mechanisms in the financial sector generate the observed growth vulnerability dynamics. (JEL C53, E23, E27, E32, E44) [ABSTRACT FROM AUTHOR]

This paper empirically assesses whether monetary policy and its volatility affect real economic activity through their effect on the aggregate supply side of the macroeconomy. Analysts typically argue that monetary policy either does not affect the real economy (the classical dichotomy) or only affects the real economy in the short run through aggregate demand (new Keynesian or new classical theories). Real business cycle theorists try to explain the business cycle with supply-side productivity shocks. We provide some preliminary evidence about how monetary policy and its volatility affect the aggregate supply side of the macroeconomy through their effect on total factor productivity and its volatility. Total factor productivity provides an important measure of supply-side performance. The results show that monetary policy and its volatility exert a positive and statistically significant effect on the supply side of the macroeconomy. Moreover, the findings buttress the importance of reducing short-run swings in monetary policy variables as well as support the adoption of an optimal money supply rule. Our results also prove consistent with the effective role of monetary policy during the so-called ‘Great Moderation’ in US gross domestic product volatility beginning in the early 1980s. [ABSTRACT FROM AUTHOR]

Thoughtful economists have long been aware of the limitations of national accounting and GDP in measuring economic activity and material well-being. Feminist economists criticize the failure to count women's unpaid and reproductive work in measures of economic production. This paper examines the treatment of human milk production in national accounting guidelines. Human milk is an important resource produced by women. Significant maternal and child health costs result from children's premature weaning onto formula or solid food. While human milk production meets the standard national accounting criteria for inclusion in GDP, current practice is to ignore its significant economic value and the substantial private and public health costs of commercial breastmilk substitutes. Economic output measures such as GDP thus are incomplete and biased estimates of national food production and overall economic output, and they distort policy priorities to the disadvantage of women and children. [ABSTRACT FROM AUTHOR]

This paper tests the relationship between primacy and economic development for countries in Asia and the Americas. It tests explanations for primacy drawn from several social-science disciplines – demography, economics, geography, political science, and sociology. The study is one of the first to use panel-data estimators for the tests. Economic and domestic political variables are found to be important determinants of primacy. In particular, rent-seeking and dictatorial governments are associated with primacy, but the association exists independent of the level of economic development. The implication from dependency and world-system theories that current international economic interactions promote primacy is not supported. It also examines the hypothesis that primacy first increases and then decreases with GDP per capita. [ABSTRACT FROM AUTHOR]

ABSTRACT We reveal evidence that the US aggregate bank dividends exercise a causal impact on the US real GDP growth during the period from the introduction of the Prompt Corrective Action framework in 1992 until the outburst of the subprime mortgage market crisis in 2007. Over this period, the positive signalling effects of bank dividends outperform the negative effect of dividends on default risk. During the pre-Prompt Corrective Action and the recent post-2007 periods, bank dividends do not affect GDP growth. This regime-dependent relation is due to an asymmetric role of bank default risk. These findings are of interest to bank regulators in reassessing the role of bank dividends within Basel III and carry important policy implications as bank dividends constitute an important tool available to policy makers for strengthening real activity. Copyright © 2014 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

We revisited the evidence of Karagianni et al. (Int Rev Econ Fin 21:186-194, ) and Tiwari (Econ Bull 32:147-159, ) by employing a recently developed and more powerful nonlinear Granger-causality test proposed by Nishiyama et al. (J Econ 165:112-127, ) to investigate the existence of Granger-causality from a set of alternative tax burden (ratios) to GDP (per capita GDP), for the period 1947:q1-2009:q3 for the United States of America (USA). The nonlinear Granger-causality test provides strong evidence that personal current taxes and taxes on production and imports Granger-cause GDP and weak evidence that CR Granger-cause GDP. As a consequence, in order to influence (rebalance) the USA's GDP through taxation, it is recommended to the USA government to adjust the tax structure, focusing on PCT and taxes on production and imports' shocks. In this case, the tax policy is oriented especially on labour supply and investments. [ABSTRACT FROM AUTHOR]

Under current policies the deficit may get to 7% of GDP in 10 years. Our political process is not coming to grips with responsible fiscal policy. We have both parties agreeing a deficit is a great way of attracting votes. Future increases in spending are coming from entitlements. We need incentives in health care to do things more efficiently and encourage competition. The biggest risk for the U.S. economy is the global bond market. We need to get moving. If not, eventually inflation, or a crisis of confidence, will be the wake-up call on the growth of U.S. debt. [ABSTRACT FROM AUTHOR]

We introduce synthetic control methods (SCM) as a forecasting technique. Using (i) as economic predictors solely the outcome itself, i.e. lagged values of the dependent variable, and (ii) lagged time series of the outcome to build the donor pool, we let SCM choose and weight appropriate values in order to come up with a sensible forecast of the US GDP growth. This procedure performs competitively viable compared with alternative forecasting methods. [ABSTRACT FROM AUTHOR]

Do considerations that cause military spending increases symmetrically cause spending cuts? Models of military spending that estimate a single effect for major independent variables implicitly assume that this is the case. In reality, the mechanisms that cause military spending increases do not always imply symmetrical cuts, and vice versa. This article examines two considerations widely held to influence military spending: economic growth and international threats. In both cases, there are reasons to suspect asymmetric effects on military spending. While recessions always create pressure for cuts in military spending, which frequently constitutes a substantial share of national budgets, economic growth does not necessarily imply a symmetric need for spending increases. Similarly, while national security policymakers, including the military, are likely to call for spending increases when international threats worsen, they have self-interested reasons to minimize the budgetary implications of declining threats. A cross-national analysis of military spending since World War II shows that economic decline has a larger impact on military spending than economic growth. In regards to international threat, the findings are more complex. There is no evidence that international threat is related to changes in military spending in the short run, and little evidence of a long-run relationship. The threat variables appear to account for cross-sectional variation in military spending but not variation within each state over time. These results suggest military budgets require more time to recover from economic decline than benefit from economic growth as recessions can thus produce long deviations from the equilibrium relationship between the size of the economy and the military budget. This finding in military spending suggests consequences for our understanding of balance of power and power transitions. [ABSTRACT FROM AUTHOR]

The article examines the economic strategy of the U.S. toward China as of 2017. Topics include the increasing flow of Chinese foreign direct investment into the U.S., the claims by proponents of the second school of thought that China is pursuing an economic strategy designed to enhance its growth and development at the expense of its trading partners, the impact of trade and trade deficits on the national security of the U.S. and the potential of China to surpass the U.S. in terms of gross domestic product.

The article reports on the economic development problem in Latin America in relation to that of the U.S. It provides an assessment and interpretation of the poor economic performance in Latin America by focusing on trended data on gross domestic product (GDP) per capita between 1960 and 2009. It documents the basic facts about the development problem in Latin and decomposes GDP per capita to show that low total factor productivity (TFP) is at the core of the problem.

Abstract: This paper hypothesized that democratic nations, as characterized by Polity IV Project regime scores, spend more on health care than autocratic nations and that the association reported here is independent of other demographic, health system or economic characteristics of nations. WHO Global Observatory data on 159 nations with roughly 98% of the world’s population were examined. Regime scores had significant, direct and independent associations with each of four measures of health care expenditure. For every unit increment in a nation’s regime score toward a more democratic authority structure of governance, we estimated significant (p <0.05) increments in the percent of GDP expended on health care (+0.14%), percent of general government expenditures targeted to health care (+0.25%), total per capita expenditures on health (+34.4Int$) and per capita general government expenditures (+22.4Int$), while controlling for a population’s age distribution, life expectancy, health care workforce and system effectiveness and gross national income. Moreover, these relationships were found to persist across socio-economic development levels. The finding that practices of health care expenditure and authority structures of government co-vary is instructive about the politics of health and the challenges of advancing global health objectives. [Copyright &y& Elsevier]

The article discusses a study which examines the relationship between coal, renewable energy, natural gas and electricity consumption and economic growth in the U.S. from 1949 to 2009 through fractional cointegration approach. It found that fractional cointegration is evident between consumption of coal and economic development. The analysis suggests that natural gas consumption and real gross domestic product (GDP) are not fractionally cointegrated.

This article provides a broad overview of the measurement techniques used in estimating GDP and the national accounts in the United States. In the United States, the GDP and the national accounts estimates are fundamentally based on detailed economic census data and other information that is available only once every five years. The challenge lies in developing a framework and methods that take these economic census data and combine them using a mosaic of monthly, quarterly, and annual economic indicators to produce quarterly and annual GDP estimates. One problem is that the other economic indicators that are used to extrapolate GDP in between the five-year economic census data—such as retail sales, housing starts, and manufacturers shipments of capital goods— are often collected for purposes other than estimating GDP and may embody definitions that differ from those used in the national accounts. Another problem is some data are simply not available for the earlier estimates in the reporting process. For the initial monthly estimates of GDP, data on about 25 percent of GDP—especially in the service sector—are not available, and so these sectors of the economy are estimated based on past trends and whatever related data are available. The initial monthly GDP estimates based on these extrapolations are revised as more complete data become available In producing the national accounts estimates, the Bureau of Economic Analysis attempts to strike a balance between accuracy and timeliness so that the estimates can be used to monitor real overall economic growth and inflation, as well as major sectors of interest. [ABSTRACT FROM AUTHOR]

The U.S. economy faces sizeable headwinds to keeping GDP growth even at 2% over the next decade. Demographics imply that labor force growth will be much slower than historical norms. The enormous twentieth century increase in average educational attainment is unlikely to be repeated. And the best guess for productivity growth is that it will continue to be modest-perhaps along the lines seen in the 1970s to early 1990s, or since 2004. There are no easy cures for low growth. We can hope for another wave of broadbased IT-linked innovation. But while there is enormous uncertainty, even worthwhile policy steps are unlikely to move the dial very much on their own. [ABSTRACT FROM AUTHOR]

Analyzing the performance of the economy in real time is a challenge for those who must forecast macroeconomic variables such as inflation or employment. A key aspect of this challenge is evaluating the incoming flow of information contained in economic announcements. In this article, the authors develop a simple-to-read index of these announcements that they then use to construct nowcasts. The index tracks whether key economic data have come in stronger, weaker, or as expected during the current quarter relative to a baseline consensus forecast. Specifically, the data releases are weighted relative to their importance in updating forecasts of real gross domestic product growth during the current quarter. [ABSTRACT FROM AUTHOR]

Nonfarm employment continued to expand in 2015. Private service-providing industries accounted for the vast majority of job gains. Despite a slowdown in the overall rate of job growth in 2015, the gains were a continuation of an expansion that started in May 2014, when employment recovered to its previous peak level of January 2008. [ABSTRACT FROM AUTHOR]