Managerial Insights

2022-10-03 Donato Masciandaro

Monetary Normalization: The Lesson of Whatever It Takes

On July 26, 2012, Mario Draghi pronounced the words that would enter the Treccani Dictionary as an expression that “opened another, unprecedented horizon in European politics.” To shed light on the significance of “whatever it takes,” we can tell the story of the evolution of the monetary announcement as an opera in three acts. Act I: We are at the end of the 1970s, when the dominant problem for the policies of advanced countries is to defeat the Great Inflation. Economic analysis offered a recipe to obtain an effective monetary policy, that was based on two ingredients, mixed together: ...

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2022-09-21 Cecilia Attanasio Ghezzi

Beijing Returns to Coal

Last August, we saw the skyline of megalopolises like Shanghai and Chongqing go dark. Factors that assemble machines and electronic devices then distributed in the rest of the world stopped due to a lack of electricity. Long lines formed in front of recharging stations for electric vehicles, while river flow was reduced to the point of preventing navigation by boats of a certain size. Energy rationing affected above all the southwestern regions of the immense territory of China, where up until now, such measures had never been seen; in the region of Sichuan, in particular. This area gets 80 percent ...

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2022-09-07 Gianmarco Ottaviano

Gorbachev’s Ambivalent Legacy in Russia

In the Bible (Daniele, 2:31-35) King Nebuchadnezzar dreamed of a colossal statue with a head made of gold, the chest and arms of silver, the stomach and hips of bronze, the legs of iron and the feet made partly of iron and partly of clay. A stone broke off the mountain and hit the statue’s feet, smashing them and making it collapse. According to the prophet the story is a metaphor for the succession of earthly kingdoms, destined sooner or later to collapse due to the weakness of the values on which they are founded. The Soviet Union dissolved on December 26, 1991. At the start of that year it ...

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2022-09-05 Roberto Ruozi

A (Positive) Glance at the Future of Italian Banks

The economic situation in our country is fairly confused, making it difficult to develop forecasts for the future, even in the short term. Apart from the question of energy, that will have a considerable impact on our economy – and it is not known how it can be solved, with all of the potential consequences – numerous other indicators seem to suggest that we are beginning to return to a model of development that had disappeared for years, but has not been substituted by valid alternatives. The new and most important indicators that will characterize that model are inflation, “normal” levels ...

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2022-07-25 Cecilia Attanasio Ghezzi

Has Beijing’s Economic Dream Reached the End of the Line?

“Without [bank] deposits, there are no human rights,” “The ‘Chinese dream’ of 400,000 depositors was shattered in Henan.” The banners shown by the demonstrators in Zhengzhou, the capital of the region of the same name in Central China, went viral in just a few hours. It was July 10, 2022, and hundreds of men and women who demanded access to their savings were beaten up by not-better-identified plainclothes agents. They have been asking for compensation from the local government since mid-April. But in June, when they attempted to organize the first public demonstration, their digital ...

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2022-07-13 Elisa Borghi, Donato Masciandaro

Urban Governance, Economic Growth, and Civic Capital: History Counts, in the South As Well

What is the most common interpretation the media have given of the recent local elections? The answer: a major test of the strength of the center-left and center-right coalitions in view of the upcoming national political elections. No surprise here, provided that this perspective never makes us forget how important urban governance can be to influence the economic and civic growth of citizens; even after centuries. This is one of the most intriguing results of a recent current of academic research that takes the name of “persistence.” The idea is ultimately simple: the economic and social ...

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2022-06-28 Cecilia Attanasio Ghezzi

The Uyghurs in China and the Risk of Genocide

On June 9 of this year, the European Parliament approved a resolution that prohibits the importation of products made through forced labor of Uyghurs. In the wake of the law approved last December by the United States Congress, the EU stressed that the separation of children from their families, sterilization programs, and forced labor in the autonomous region of Xinjiang “are crimes against humanity and can constitute genocide.” This is a harsh condemnation of Beijing, but like all resolutions, is non-binding. De facto, it is a way to put pressure on the European Commission and the Member ...

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2022-06-16 Andrea Beltratti, Alessia Bezzecchi

All Quiet on the Western Front? The Challenge of Sustainable Sustainability

In six months the macroeconomic picture has changed radically: from growth without inflation to anticipated stagflation. In December 2021, the ECB forecast economic growth of 4.2% in 2022, a reduction from the forecast of 4.6% formulated in September of the same year. Inflation was expected to be 3.2% for 2022, a strong increase from the 1.7% expected in September. In June 2022, the forecast for growth fell to 2.7% and inflation could exceed 8% in May. In the United States, growth for 2022 could be 3%, but most economists see a recession coming within 12 months, and inflation is already 8.6%. ...

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2022-05-25 Roberto Ruozi

What Happens After Financial Crises

Despite the progress made by national and international oversight authorities, the number of banking and financial scandals has grown, creating increasing problems for shareholders, creditors, employees, and other stakeholders, and often provoking a very dangerous domino effect. In recent years I have dealt with some of them, such as Gamestop, Archegos, Wirecard, Evergrande, Greensill, and N26 Bank. Those scandals, that have been amply analyzed and commented on in the specialized press, remained in the news for a while, especially in Germany, the United Kingdom, the United States, and China, but ...

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2022-05-18 Cecilia Attanasio Ghezzi

The Great Flight from China

It all began at the end of March. The approximately 25 million residents of Shanghai underwent mass Covid tests, and then, although the authorities had said it wasn't necessary, an unprecedented lockdown was implemented. One week later, the logistics of the most modern and cosmopolitan city of continental China were in total chaos. No food for citizens blocked in their homes by decree, medical urgencies ignored, families divided, nursing homes out of control, quarantine centers overflowing, illuminated 24 hours a day and without showers. General discontent on social networks, followed by censure. ...

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