INTERNATIONAL  INSTITUTE FOR SOCIAL AND ECONOMIC STUDIES 

National populism is unstoppable – and the left still doesn’t understand it

It’s not about immigration, the financial crisis, globalisation or inequality, but evidence of a broader, older social fragmentation

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New Players In A Dollarized World – Analysis

A multipolar currency landscape could emerge as other nations question the US dollar’s near-monopoly over global trade and reserves. 

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Ease of Doing Business and Getting the Right Indexes Right

04.10/2018

Published with the kind permission of the author

Last night I commented on a TV channel about India’s climb up on the Ease of Doing Business (EODB) ladder. I congratulated the government but caveated that if it takes 180 days to get land registered and 156 days to get a building permit, that then that is the critical path line that determines the real EODB. It does matter if a bank sanctions a loan in 30 days, but what is the use if it doesn’t disburse the money till much later and then, given the liquidity crunch, often too little of it? How does it matter if EODB, which is mostly about government sanctions and processes, gets better when it is near impossible to get a trained machinist or an appropriately skilled engineer? The EODB index is meant to measure regulations directly affecting businesses and does not directly measure more general conditions such as a nation's proximity to large markets, quality of infrastructure, inflation, or crime.

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The US culture wars

01.10/2018

Published with the kind permission of the author

The coming midterm elections matter because their outcome will affect the cosmological beliefs of much of the world

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Japan joins to shape China’s Belt and Road

29.10/2018

On the first state visit to China by a Japanese leader in 11 years, Prime Minister Shinzo Abe and President Xi Jinping announced 50 joint infrastructure projects. This embrace of joint infrastructure investment cooperation through the Belt and Road Initiative in all but name is on a scale even larger than was anticipated before Abe’s arrival in Beijing. There was also a raft of other announcements that will help normalise the political relationship between the two Asian giants that share one of the largest economic relationships in the world. But the most consequential of those could be the joint investment in infrastructure projects. 

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Leaders of Asia and Europe sit down for talks, not sanctions

24.10/2018

The 12th ASEM summit came at a crucial time with a divided EU assessing how to respond to China's worrying technological transfer policy and the Belt and Road Initiative

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Lessons from Europe

22.10/2018

More than a decade on from the most devastating financial crisis since the crash of Wall Street in 1929, politicians and commentators have been extremely careful in offering predictions on when the next crisis will occur. Playing with economic predictions is like playing with fire. Nobody knows this better than former British prime minister and chancellor of the exchequer Gordon Brown, who repeatedly promised ’no return to boom and bust’.

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A short course on the history of money

16.10/2018

Banks are behind our boom-and-bust economy, creating money in the form of loans (mostly to industry, but also mortgages), conducting our industrial policy behind our backs. Why? Are they really so omniscient, so capable of steering us into a bright future? Shouldn’t they have public policy shaping their lending? Isn’t charging interest on money they create a scam? Just rubbing salt in the wound? Stealing based on their original theft from the public?

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‘Great Depression’ ahead? IMF sounds dire warning

09.10/2018

Potential flashpoints and a long line of dominos Italy is the current flashpoint – and the latest target of “domino effect” chatter in frothy world markets. China’s shadow-banking bubble, and the extreme opacity and regulations that enable it, also came in for criticism. And, of course, the 800-pound beast in any room where global investors gather these days: Donald Trump’s assault on world trade.Massive government debts and eroded fiscal buffers since 2008 suggest global dominos await a single market crash.

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India re-defines its regional role

01.10/2018

Recent foreign policy moves by New Delhi indicate an inflexion point. Combining orthodox ideas from the Cold War era along with 21st century pragmatism, it appears that India has decided that the emerging multipolar world is becoming far too complicated for the binary choices and easy solutions that some had envisioned for the country’s foreign policy. Not only has it recast its approach to the maritime Indo-Pacific but as the recent Shanghai Cooperation Organisation (SCO) summit exemplifies, it is also building deeper and more constructive links with continental Eurasia.

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FOUNDATIONAL PROBLEMS OF POLITICAL ECONOMYPART III: MACROECONOMICS FROM THE PERSPECTIVE OFSUSTAINABLE CREATIVITY

27.09/2018

© 2018 Dr. Nicolas Laos 

Economic Assumptions 

According the positivist-empiricist tradition, a theory is a set of generalizations about the behavior of the world, and the real test of a scientific theory is its ability to predict. In other words, for positivism-empiricism, prediction is the true criterion of whether a particular theory is correct or not. Working within the positivist-empiricist tradition, Milton Friedman, the founder of a neoclassical school of economic thought known as the “Chicago school of economics”, formulated an instrumentalist explanation of economic assumptions. For Friedman, the theory is an instrument of prediction, and, therefore, the value of a theory is determined by its ability to predict observable phenomena.  

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FOUNDATIONAL PROBLEMS OF POLITICAL ECONOMYPART TWO: ECONOMIC LAWS AND THE DYNAMICS OF THE ECONOMIC SYSTEM

27.09/2018

© 2018 Dr. Nicolas Laos 

Causes and Consequences in Political Economy 

In the philosophy of science, by the term ‘law’, we mean a proposition that establishes a relation between variables, variables being concepts that can take different values. The concept of a ‘natural law’ has been central to our understanding of the natural sciences. The history of modern political economy can be traced back to physiocracy, which was the first methodical attempt to explain economic behavior in similar ways to natural (that is, inanimate) behavior. Physiocracy was particularly dominated by François Quesnay (1694–1774) and Anne-Robert-Jacques Turgot (1727–81). According to the physiocrats, there was a ‘natural order’ that allowed human beings to live together. Within the framework of the physiocrats’ political economy, the human being is merged with the natural world, so that it reduces to merely a particular consequence of the operation of natural laws. Paul Samuelson and William D. Nordhaus write about physiocracy:  

A remarkable depiction of the economy as a circular flow, still used in today’s texts . . . was made by Quesnay, Louis XIV’s court physician. He stressed that the different elements of the economy are as integrally tied together as are the blood vessels of the body. 

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FOUNDATIONAL PROBLEMS OF POLITICAL ECONOMYPART ONE: THE PRINCIPLE OF SUSTAINABLE CREATIVITY

27.09/2018

© 2018 Dr. Nicolas Laos 

Economic analysis underpins and informs economic decision-making, even if there is a lengthy lag between economic analysis and its gradual absorption into economic debate. Once established as common sense, a text of economic analysis becomes incredibly powerful, because it delineates not only what is the object of knowledge but also what it is sensible to talk about or suggest. If one thinks and acts outside the framework of the dominant text of economic analysis, he risks more than simply the judgment that his recommendations are wrong; his entire moral attitude may be ridiculed or seen as dangerous just because his theoretical assumptions are deemed unrealistic. Therefore, defining common sense and, indeed, what is ‘reality’ and ‘realistic’ is not only the quintessence of an ontologically grounded economic theory but also the ultimate act of political power. Economic analysis does not simply explain or predict, it tells us what possibilities exist for human action and intervention; it defines both our explanatory possibilities and our moral and practical horizons. Hence, ontology and epistemology matter, and the stakes are far more considerable than at first sight seem to be the case. 

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Public Revenue Without Taxation

21.09/2018

Published with the kind permission of the author

THE IDEA 

The market mechanism provides the most efficient way of allocating the resources of an economy. Yet public services, which can count for around half of economic activity, are charged for indirectly through taxes which have no direct connection to what the payer receives in return.  

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Is the increasing multipolarity dragging the world into chaos?

11.09/2018

Disrupting environmental-climatic factors are triggering multiple economic, social and existential emergencies to which insufficient responses are being given.

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Remembering Samir Amin, Who Dedicated Himself to Overcoming Capitalism

25.08/2018

The anti-imperialist scholar was very critical of the models of development and of the institutional structures of nation-states in developing countries that slavishly imitated the West, which he felt enabled colonialism to easily transmogrify into neo-colonialism.

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Economic Science and Economic and Mathematical Models

Members only

The growing threats of the global crisis compel governments of all countries to develop anti-crisis measures. However, no country has a plan in the form of an algorithm of actions for overcoming the global crisis. 

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India clocked 10.08 per cent growth under Manmohan Singh's tenure: Report

18.08/2018

India’s economic growth numbers, adjusted for the base year of FY12, show that expansion was marginally higher under the new series after the economy picked up pace in FY04 and generally lower in the preceding years. 

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US vs the World: Trade war as the last attempt to salvage domestic economy

01.08/2018

Published with the kind permission of the author 

On Wednesday, July 25, President Donald Trump met with Jean-Claude Juncker, the president of the European Commission, at the White House. The U.S. has already slapped tariffs on European steel and aluminum, and the EU has reciprocated with tariffs on $3 billion worth of American exports, such as whiskey and motorcycles.

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It is Time for Russia to Change the Course of Globalization

27.07/2018

Published with the kind permission of the author 

The global economic and political chaos is rapidly evolving. At the same time, solving the problems with the use of “business as usual” military force has become dangerous for all and everyone. Therefore, today when the world is being gradually dragged into the third world war, which may destroy the civilization, it is necessary to take action for changing the course of globalization. What tools are currently available on the basis of the accumulated management experience in order to change the course, which is detrimental to the civilization? 

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