GENED 1120 – The Political Economy of Globalization
Faculty: Robert Z. Lawrence (Kennedy School) and Lawrence H. Summers
This course analyzes how a globalizing world of differing countries – rich and poor, democratic and authoritarian – can best promote inclusive growth and human security by meeting the challenges of inequality, climate change, rising populism, war, and global disease. Why is populism becoming pervasive – and is there a revolt against global integration? What is the right balance between national sovereignty and international integration? Is the US equipped to sustain its role as a global leader? How does international trade affect prosperity and inequality? Should we regulate multi-national companies who move their factories to countries with lower labor standards? How should the IMF respond to financial crises in Europe and the developing world? How will the rise of China change the world system? This course uses basic economic logic to illuminate the choices – and trade-offs – faced by governments, international institutions, businesses, and citizens as the global economy evolves. Our course is based on the premise that passion without careful reason is dangerous and that reliance on solid analytics and rigorous empirical evidence will lead to a better world. Policy issues are debated in class by the professors and guest speakers, and students will participate in simulated negotiations on US climate policy and the US-China economic relationship, experiencing the issues firsthand, as well as illustrating the importance of decisions made by individual actors for the evolution of the global system.
Economics 1420 – American Economic Policy
Faculty: Jeffrey B. Liebman (Kennedy School) and Lawrence H. Summers
This course analyzes major issues in American economic policy, including national savings, taxation, health care, Social Security, budget policy, monetary and fiscal policy, and exchange rate management. Current economic issues and policy options are discussed in detail and in the context of current academic thinking.
Econ 1499 – Macroeconomic Stabilization Policies
Faculty: Sir Paul Tucker, Former Deputy Governor of the Bank of England, and Lawrence H. Summers
With real interest rates negative for nearly a decade and nominal interest rates close to zero, and fiscal deficits and debt-to-GDP ratios at unprecedented levels, we are in a new era for macroeconomic policy making. This seminar course will focus on macroeconomic policy issues posed by secularly low real interest rates (secular stagnation?), COVID-19, and government debt accumulation. The focus will be on the application of rigorous macroeconomic analysis to policymaking.The objective of the class is to expose students to the kind of thinking and work done by practicing macroeconomists. The centerpiece of the class will be student research papers, 25- to 30-pages, on macroeconomic topics, developing, applying, or testing relevant economic theory. Students will work closely with one of the course instructors and an economics PhD student on their papers. During seminar meetings, students will present and lead discussions of major recent research papers, and present their ongoing work.Examples of topic areas for papers might include: The role of risk premiums vs. savings-investment gaps in explaining interest rate fluctuations; the influence of social insurance on aggregate demand; Ricardian equivalence and the impact of fiscal policy in raising long run demand; the implications of low rates for target returns on institutional portfolios, financial stability, and creative destruction; saving gluts and current account surpluses; the risks of destabilizing deflation; and lessons from the Japanese experience.
