The Leaderless Economy: Why the World Economic System Fell Apart and How to Fix It

The Leaderless Economy: Why the World Economic System Fell Apart and How to Fix It

by Peter Temin
     
 

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The Leaderless Economy reveals why international financial cooperation is the only solution to today's global economic crisis. In this timely and important book, Peter Temin and David Vines argue that our current predicament is a catastrophe rivaled only by the Great Depression. Taking an in-depth look at the history of both, they explain what went wrong and

Overview

The Leaderless Economy reveals why international financial cooperation is the only solution to today's global economic crisis. In this timely and important book, Peter Temin and David Vines argue that our current predicament is a catastrophe rivaled only by the Great Depression. Taking an in-depth look at the history of both, they explain what went wrong and why, and demonstrate why international leadership is needed to restore prosperity and prevent future crises.

Temin and Vines argue that the financial collapse of the 1930s was an "end-of-regime crisis" in which the economic leader of the nineteenth century, Great Britain, found itself unable to stem international panic as countries abandoned the gold standard. They trace how John Maynard Keynes struggled for years to identify the causes of the Great Depression, and draw valuable lessons from his intellectual journey. Today we are in the midst of a similar crisis, one in which the regime that led the world economy in the twentieth century—that of the United States—is ending. Temin and Vines show how America emerged from World War II as an economic and military powerhouse, but how deregulation and a lax attitude toward international monetary flows left the nation incapable of reining in an overleveraged financial sector and powerless to contain the 2008 financial panic. Fixed exchange rates in Europe and Asia have exacerbated the problem.

The Leaderless Economy provides a blueprint for how renewed international leadership can bring today's industrial nations back into financial balance—domestically and between each other.

Editorial Reviews

Publishers Weekly
Two highly regarded economists, MIT’s Temin (Prometheus Shackled) and Oxford University–Balliol College’s Vines (The IMF and Its Critics), examine the evolution of Keynesian thought since the 1920s and discuss cures for today’s multinational unemployment, debt, and other economic problems. Exports and balance of trade, exchange rates, fiscal policy, and interest are among their moving parts. Conflicting solutions among nations worsen the economic crisis, they fear. As during the 1930s, the global economy no longer has a universally recognized leader or hegemon, yet international cooperation is essential to global industrial recovery. Temin and Vines explain why this is easy to say but hard to achieve, reviewing poor macroeconomic choices that have equal political traction with good ones. A powerful chapter on the American century and financial crisis since 2008 explores U.S. reversals and capacity for future global leadership. In addition, China’s “export-led development strategy” and emergent geoeconomic role get a close look. Saddled with a bland (and arguably misleading) title, Temin and Vines’s measured analysis will reward serious readers and economists who can keep up with global theory in motion. However, policy spinners looking for painless, politically popular remedies for high unemployment rates and deflationary trends will come away empty-handed. (Feb.)
Financial Times - Tony Barber
[The Leaderless Economy] presents sensible arguments in favour of a rebalanced world economic system.
Huffington Post - Glenn C. Altschuler
In The Leaderless Economy, Temin and Vines demonstrate that Keynes' economic theories remain robust and relevant. . . . [T]heir book provides a clear and compelling analysis of the roots of our global financial crisis and the lessons we can learn from it.
Bloomberg News - Daniel Akst
You can learn a lot by reading [The Leaderless Economy]. . . . The authors are commendably alert throughout to the economic and political complexities involved.
From the Publisher
One of Choice's Outstanding Academic Titles for 2013

"[T]emin and Vines's measured analysis will reward serious readers and economists who can keep up with global theory in motion."Publishers Weekly

"A rigorous analysis of the collapse of the world economy in 2008—and why things don't seem to be getting better. . . . [S]obering."Kirkus Reviews

"[The Leaderless Economy] presents sensible arguments in favour of a rebalanced world economic system."—Tony Barber, Financial Times

"In The Leaderless Economy, Temin and Vines demonstrate that Keynes' economic theories remain robust and relevant. . . . [T]heir book provides a clear and compelling analysis of the roots of our global financial crisis and the lessons we can learn from it."—Glenn C. Altschuler, Huffington Post

"You can learn a lot by reading [The Leaderless Economy]. . . . The authors are commendably alert throughout to the economic and political complexities involved."—Daniel Akst, Bloomberg News

"Temin and Vines . . . offer a thoughtful exploration of the situation of the world financial system through detailed analysis and comparisons of the recent international economic crisis with circumstances during the Great Depression. . . . The book is a great resource for those interested in international economics and history. A must read for upper-division undergraduate students, business leaders, and future policy makers, and a pleasure for graduate students, faculty, and general readers."Choice

"In this timely and important book, Peter Temin and David Vines argue that our current predicament is a catastrophe rivaled only by the Great Depression. Taking an in-depth look at the history of both, they explain what went wrong and why, and demonstrate why international leadership is needed to restore prosperity and prevent future crises."World Book Industry

Kirkus Reviews
A rigorous analysis of the collapse of the world economy in 2008--and why things don't seem to be getting better. Following a crash and a modest bounce back, the world's economic recovery has been stalled for at least two years, write economists Temin (The Roman Market Economy, 2012, etc.) and Vines (co-author: The IMF and Its Critics, 2004, etc.); moreover, they add, "the world economy is 10 percent poorer than it would have been had economic growth continued smoothly after 2007." The crisis has been so deep and thorough that, in many ways, it parallels the Great Depression, which occasions a longish account of Keynesian economics and its theories of stimulus and monetary versus fiscal policy--all matters in which economists will be right at home, though general readers not so much. Divided among different shifting blocs at a time of economic regime change, whence leaderless, the world's economy risks falling into another Depression, the authors argue, unless appropriately post-Keynesian remedies are put into place, particularly to settle the deep imbalance in trade flows and payments. We need only look for examples at the imbalances that obtain between parts of the European Union and between the U.S. and China, but the authors give others over time. Examining alternatives such as a "floating exchange rate world" and a China willing to export less (and a U.S. willing to consume less, for that matter), they explore the possibilities, however remote, of avoiding further calamity. Suffice it to say that austerity is not one of them. Dense and detailed. One doesn't have to hold a doctorate in economics to read this sobering treatise, but it helps.

Product Details

ISBN-13:
9780691157436
Publisher:
Princeton University Press
Publication date:
01/22/2013
Pages:
320
Sales rank:
639,484
Product dimensions:
6.00(w) x 9.30(h) x 1.10(d)

Meet the Author

Peter Temin is the Elisha Gray II Professor Emeritus of Economics at the Massachusetts Institute of Technology. His books include Prometheus Shackled, The Roman Market Economy (Princeton), and The World Economy between the World Wars. David Vines is Professor of Economics and a Fellow of Balliol College, University of Oxford. His books include The IMF and Its Critics and The Asian Financial Crisis.

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