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Mar 202013
 

Transworld Paper No. 11

by  Kati Suominen

The United States responded to the Great Recession with an arsenal of fiscal and monetary expansions and export promotion policies to stimulate growth, but only for temporary respite. US policies have been reactive and risked counterproductive effects. Four years after the collapse of the investment bank Lehman Brothers, economic growth is flailing, unemployment continues persistently high, and fiscal deficits have soared. Though the rules-based world economic order that the United States has built over the past seven decades has persevered, international economic policy challenges are mounting, exacerbated by the lack of US economic vitality and leadership. The purpose of this paper is to assess US adjustment policies to the global economic crisis, propose solutions to impending policy challenges, and discuss the state of the transatlantic relationship in light of the recent events and US policy priorities.

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Mar 202013
 

Transworld Working Paper No. 10

by Andrea Renda

The globalization of the economy of the past two decades has created more challenges than opportunities for the EU. Already at the beginning of this century, the EU started feeling a heavy pressure from emerging economies, which led to a reshuffling of global GDP shares, the polarization of EU job markets and a gradual loss of competitiveness in several industry sectors. The economic downturn since 2008 has just exacerbated this process. Overall, this paper portraits a rather gloomy outlook for Europe’s future role in the global economy: the EU suffers from major weaknesses at home, not least due to lack of political and economic integration and the prevalence of parochial instances in the trade negotiations. Current policy responses in the domain of trade policy, innovation and industrial policy do not seem likely to restore and ensure the EU’s leading role in the global economy.

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