An important question in international macroeconomics is the degree to which advanced economy (AE) investors impact the economic policies of emerging market economy (EME) borrowers. The basic question about how EMEs can manage their economies has been discussed generally through the debate about the Mundell-Fleming ‘policy trilemma’ and its implications for open capital markets in […]
After the pandemic, central banks faced the daunting challenge of stabilising prices as supply chain disruptions led to rising costs (Ostry et al. 2022) and geopolitical tensions (Ben Cheikh et al. 2023) and aggressive monetary tightening by the Federal Reserve led to significant fluctuations in exchange rates. All the while, policymakers at major central banks […]
Policy initiatives in several European countries have targeted bank profits to secure public funds. These measures include introducing windfall taxes on excess profits and, in some instances, encouraging higher, taxable dividend pay outs. At face value, the case for taxing banks appears intuitive: people are facing hardship and banks are making record profits. This column […]
