Otaviano Canuto on Financial Globalization

Discussions around large current account imbalances among systemically relevant economies as a threat to the stability of the global economy faded out in the aftermath of the global financial crisis. More recently, some signs of a possible resurgence of rising imbalances have brought back attention to the issue. We argue here that, while not a threat to global financial stability, the resurgence of these imbalances reveals a sub-par performance of the global economy in terms of fore ...

Brazil’s GDP contraction since mid-2014 has multiple non-fiscal roots - Canuto (2016a; 2014) – but it has morphed into an unsustainable fiscal trajectory (Canuto, 2016b). Dealing with the latter has become a precondition for full economic recovery and the Brazilian government has submitted to Congress a constitutional amendment bill mandating a public spending cap for the next 20 years. This piece considers how the Brazilian landscape evolved toward such a precipice and why addition ...

Le Maroc est actuellement plus que jamais menacé par le piège des économies à revenu intermédiaire. Il se retrouve pris entre, d'une part, la concurrence accrue exercée par des pays à faible revenu sur les secteurs à faible productivité et intensifs en main d'œuvre et, d'autre part, la difficulté d'accélérer son rythme de transformation structurelle vers des activités à plus forte valeur ajoutée et à contenu technologique plus élevé. L'expérience internationale nous montre que rares ...

Morocco is now more than ever threatened by the trap of middle-income economies. On one hand, it is caught between increased competition from low-income countries in low productivity and labor-intensive sectors and, on the other hand, the difficulty of accelerating its pace of structural transformation towards activities with higher value added and higher technological content. International experience shows that few countries have managed to climb to the status of an advanced econo ...

We develop an interregional computable general equilibrium model to help assess the ex ante impact of transportation infrastructure policies in Egypt. The model is integrated with a GIS network. We illustrate the analytical capabilities of the model by looking at the domestic integration of the country. Improvements of transportation costs among Egyptian governorates and of their links to the broader world economy are considered in stylized simulations. The results provide quantitat ...

Brazil has been suffering from anemic productivity growth. This is a major challenge because in the long run, sustained productivity increases are necessary to underpin inclusive economic growth. Without them, increases in real labor earnings tend to conflict with global competitiveness; collecting taxes in order to fund government expenditures on infrastructure and social policies becomes a heavy burden; returns to private investment becomes harder to achieve; and ultimately citize ...

L’objectif de ce travail est d’aborder la problématique de la transformation structurelle à travers une analyse par le concept de la complexité économique de Hausmann et Hidalgo, en se focalisant davantage sur les pays à revenu intermédiaire. Dans un premier temps, des régressions en données de panel utilisant la méthode des GMM en système, afin d’éviter les problèmes d’endogeneité, ont permis de mettre en évidence un lien empirique positif et significatif entre la complexité économ ...

On July 15, Turkey’s tumultuous 2016 took a shocking twist as elements within the country’s military attempted a coup against the government of President Recep Tayyip Erdogan. The putsch rapidly snapped at the seams, and a night that began with soldiers blocking bridges yielded a morning with those same soldiers flogged by civilians in the street. In the days following the attempt, Erdogan declared a three-month state of emergency and began purges of depth and breadth that extended ...