A new report from the World Bank says China will have to make structural changes to its economy and society in order to prolong growth for the next two decades, writes Keith B. Richburg for the Washington Post. Beijing must reduce the influence of state-owned enterprises, increase competition in the financial sector, bolster innovation, and ease residency restrictions, according the report. Some analysts say reformers may use the report in preparations for a future ideological debate over the role of the state in the economy.
CFR’s Ted Alden is in Wisconsin today for a series of events on the topic of “Free Trade and Jobs,” organized by the Institute of World Affairs at the University of Wisconsin-Milwaukee. He wrote an op-ed piece for the Journal Sentinel discussing growing international trade, U.S. manufacturing jobs, and recommendations for improving U.S. competitiveness.
International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.
Corporate Regulation and Taxation
The Chaotic World of Derivatives
In the Guardian, Warwick University Professor Ian Stewart explains a mathematical equation that was misused in ways that helped fuel the global financial meltdown: Black-Scholes. The equation—a product of Nobel prize-winning economists Fischer Black and Myron Scholes—”opened up the world of derivatives,” he writes, a market that by 2007 had grown to one quadrillion dollars per year. The equation made several assumptions that failed to reflect real market behavior, including volatility and access to credit.
Corporate regulation and taxation. Read more from top economists and business experts on solutions for addressing corporate tax reform.
The Case for Aging Entrepreneurs
New research suggests that age and experience might benefit entrepreneurship despite popular perceptions of disproportionately youth-led innovation. Two studies, the first by Vivek Wadhwa of Singularity University in California, and a second by Dane Stangler of the Kauffman Foundation, indicate positive trends for middle-aged entrepreneurs. According to the Economist, the findings should help alleviate two of the West’s biggest fears: that an aging population will lead to economic decline, and that older workers face few options if they lose their jobs.
In this CFR meeting, Joseph Coughlin and Kelly Michel discuss how a healthy and active aging population can contribute to economic growth, and the public policy reform, new business strategies, and profound shifts in views on aging necessary to take advantage of this opportunity.
Innovation. In the face of robust challenges from emerging markets such as India, Brazil, and China, the U.S. capacity to innovate could play a chief role in economic growth.
The Keystone XL Oil Pipeline
The Obama administration issued support for TransCanada Corp.’s proposal to build a major section of the Keystone XL oil pipeline. Analysts say the White House backing, which is for the southern portion of the pipeline, could be a political tactic to protect the president from GOP criticism directed at the administration’s energy policy. In January, the White House rejected a bid to extend the pipeline across the border to the oil sands of Canada (the Hill).
Infrastructure. Read more on how upgrading the nation’s aging network of roads, bridges, airports, railways, and water systems is essential to maintaining U.S. competitiveness.