LESSONS FROM THE GREAT RECESSION: AT THE CROSSROADS OF SUSTAINABILITY AND RECOVERY ADVANCES IN SUSTAINABILITY AND ENVIRONMENTAL JUSTICE Previously ADVANCES IN ECOPOLITICS Series Editor: Liam Leonard PUBLISHED UNDER SERIES TITLE ‘ADVANCES IN ECOPOLITICS’ Transnational Migration, Gender and Rights Volume 10 Volume Editor: Ragnhild Sollund Series Editor: Liam Leonard PUBLISHED UNDER SERIES TITLE ‘ADVANCES IN SUSTAINABILITY AND ENVIRONMENTAL JUSTICE’ International Business, Sustainability and Corporate Social Responsibility Volume 11 Edited by Maria Alejandra Gonzalez-Perez and Liam Leonard Principles and Strategies to Balance Ethical, Social and Environmental Concerns with Corporate Requirements Volume 12 Edited by Liam Leonard and Maria Alejandra Gonzalez-Perez Environmental Philosophy: The Art of Life in a World of Limits Volume 13 Edited by Liam Leonard, John Barry, Marius De Geus, Peter Doran and Graham Parkes The Sustainability of Restorative Justice Volume 14 Edited by Paula Kenny and Liam Leonard Occupy the Earth: Global Environmental Movements Volume 15 Edited by Liam Leonard and Sya Buryn Kedzior The UN Global Compact: Fair Competition and Environmental and Labour Justice in International Markets Volume 16 Edited by Maria Alejandra Gonzalez-Perez and Liam Leonard Beyond the UN Global Compact: Institutions and Regulations Volume 17 Edited by Liam Leonard and Maria Alejandra Gonzalez-Perez ADVANCES IN SUSTAINABILITY AND ENVIRONMENTAL JUSTICE VOLUME 18 LESSONS FROM THE GREAT RECESSION: AT THE CROSSROADS OF SUSTAINABILITY AND RECOVERY EDITED BY CONSTANTIN GURDGIEV Trinity College, Dublin, Ireland LIAM LEONARD California State University, Fullerton, CA, USA MARIA ALEJANDRA GONZALEZ-PEREZ Universidad EAFIT, Medellin, Colombia United Kingdom À North America À Japan India À Malaysia À China Emerald Group Publishing Limited Howard House, Wagon Lane, Bingley BD16 1WA, UK First edition 2016 Copyright r 2016 Emerald Group Publishing Limited Reprints and permissions service Contact: permissions@emeraldinsight.com No part of this book may be reproduced, stored in a retrieval system, transmitted in any form or by any means electronic, mechanical, photocopying, recording or otherwise without either the prior written permission of the publisher or a licence permitting restricted copying issued in the UK by The Copyright Licensing Agency and in the USA by The Copyright Clearance Center Any opinions expressed in the chapters are those of the authors Whilst Emerald makes every effort to ensure the quality and accuracy of its content, Emerald makes no representation implied or otherwise, as to the chapters’ suitability and application and disclaims any warranties, express or implied, to their use British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library ISBN: 978-1-78560-743-1 ISSN: 2051-5030 (Series) ISOQAR certified Management System, awarded to Emerald for adherence to Environmental standard ISO 14001:2004 Certificate Number 1985 ISO 14001 CONTENTS LIST OF CONTRIBUTORS vii SERIES EDITOR’S INTRODUCTION ix CRISIS CONTAGION FROM ADVANCED ECONOMIES INTO BRIC: NOT AS SIMPLE AS IN THE OLD DAYS Constantin Gurdgiev and Barry Trueick TURNING TIGERS INTO PIIGS: THE ROLE OF LEVERAGE IN THE IRISH ECONOMIC COLLAPSE Shaen Corbet 21 MANHATTAN IS NOT NEW YORK: THE DIVERGENT IMPORT OF THE GREAT RECESSION AND NATURAL DISASTERS ON NEW YORK CITY’S FIVE BOROUGHS Carolyn E Predmore and Lauren Trabold 57 UNASUR-GRID: FINANCING SUSTAINABLE ENERGY SOVEREIGNTY WITH THE BANK OF THE SOUTH Tony Phillips 77 ON THE EFFECTS OF COMMODITIES PRICES ON SUSTAINABLE DEVELOPMENT: AN OPPORTUNITY? Maria Aristizabal-Ramirez and Gustavo Canavire-Bacarreza v 111 vi CONTENTS IMPROVING POST-2015 DEVELOPMENT COOPERATION THROUGH DONOR SUPPORT FOR INCLUSIVE BUSINESS Maria Alejandra Pineda-Escobar and Fabian Garzon Cuervo THE GREAT RECESSION AND EMERGING MARKET FIRMS: UNPACKING THE DIVIDE BETWEEN GLOBAL AND NATIONAL LEVEL SUSTAINABILITY EXPECTATIONS Luis Alfonso Dau, Elizabeth Marie Moore and Margaret Soto GLOBAL FINANCIAL CRISIS AND THE EMERGENCE AND MATURING OF SOCIALLY RESPONSIBLE INVESTMENTS Carolina Herrera-Cano and Maria Alejandra Gonzalez-Perez AFTER THE FLOOD COMES THE TAX: EUROPEAN ROAD TO FINANCIAL TRANSACTIONS TAX Constantin Gurdgiev and Barry Murphy NETWORKED SOCIAL MOVEMENTS AND THE POLITICS OF MORTGAGE: FROM THE RIGHT TO HOUSING TO THE ASSAULT ON INSTITUTIONS Eva A´lvarez de Andre´s, Patrik Zapata and Marı´a Jose´ Zapata Campos 141 165 189 203 231 SOLAR ECLIPSE: INVESTMENT TREATY ARBITRATION AND SPAIN’S PHOTOVOLTAIC TROUBLES Ioannis Glinavos 251 CAPITAL FOR THE TWENTY-FIRST CENTURY: A RESPONSE TO ‘CAPITAL IN THE TWENTY-FIRST CENTURY’ BY THOMAS PIKETTY Amelia Correa and Romar Correa 273 ABOUT THE AUTHORS 289 LIST OF CONTRIBUTORS Eva A´lvarez de Andre´s Department of Urban and Regional Planning, Universidad Rey Juan Carlos de Madrid, Madrid, Spain Maria AristizabalRamirez School of Economics and Finance, EAFIT University, Antioquia, Colombia Gustavo CanavireBacarreza School of Economics and Finance, EAFIT University, Antioquia, Colombia Shaen Corbet Dublin City University Business School, Dublin City University, Dublin, Ireland Amelia Correa Department of Economics, St Andrew’s College, University of Mumbai, Mumbai, India Romar Correa Department of Economics, University of Mumbai, Mumbai, India Luis Alfonso Dau D’Amore-McKim School of Business, Northeastern University, Boston, MA, USA Fabian Garzon Cuervo Department of International Business, Politecnico Grancolombiano, Bogota, Colombia Ioannis Glinavos Westminster Law School, University of Westminster, London, UK Maria Alejandra Gonzalez-Perez Department of Organization and Management, EAFIT University, Antioquia, Colombia Constantin Gurdgiev Trinity College Dublin, The University of Dublin, Dublin, Ireland vii viii LIST OF CONTRIBUTORS Carolina Herrera-Cano Business School, EAFIT University, Antioquia, Colombia Elizabeth Marie Moore Department of Political Science, Northeastern University, Boston, MA, USA Barry Murphy Trinity College Dublin, The University of Dublin, Dublin, Ireland Tony Phillips Postgraduate Department, Economics Faculty (FCE/UBA), University of Buenos Aires, Buenos Aires, Argentina Maria Alejandra Pineda-Escobar Department of International Business, Politecnico Grancolombiano, Bogota, Colombia Carolyn E Predmore Department of Marketing, Manhattan College, Riverdale, NY, USA Margaret Soto Department of Political Science, Northeastern University, Boston, MA, USA Lauren Trabold Department of Marketing, Manhattan College, Riverdale, NY, USA Barry Trueick Trinity Business School, Trinity College Dublin, Dublin, Ireland Patrik Zapata School of Public Administration, University of Gothenburg, Gothenburg, Sweden Marı´a Jose´ Zapata Campos School of Business, Economics and Law, University of Gothenburg, Gothenburg, Sweden SERIES EDITOR’S INTRODUCTION While writing about the ‘renewed interest’ in inequality as extolled by leading economists such as Piketty and Stiglitz, World Bank Senior Advisor Marcelo Giugale1 has outlined four reasons as to why economists in the post-recession era are so interested in the wealth gap in society These four reasons include an uncertainty about how much inequality is acceptable, how much we should be concerned for future generations, how practical our solutions to inequality actually are and the fact that our own attempts to improve our lives are contributing to an overall inequality across society The substance of Giugale’s argument reflects on the type of ‘sustainability’ we are attempting to highlight in this volume of Emerald’s Advances in Sustainability and Environmental Justice Series While he acknowledges both Piketty’s concern that the primary owners of capital will continue to hold the vast majority of wealth globally as well as Stiglitz’s focus on the problems such truths hold for wealth creation and wealth equality in the United States, Giugale reminds his readers that we are also traditionally not in favour of forced equality as a remedy for financial imbalances Therefore, the question remains, what is the best way to tackle inequality in an enduring, just and sustainable manner? This volume contains a number of attempts to address this primary question of the post-recession era With contributors from across the globe and from a diverse set of disciplines, this collection provides a comprehensive set of chapters which will outline exactly what are the “Lessons from the Great Recession” for nation states and supra-state agencies alike This volume outlines various concepts of sustainability in the post-recession and post-bailout world These understandings are built around aspects such as fiscal, economic and social sustainability; financial sustainability and environmental sustainability Each chapter details the relationships of sustainability that have emerged in the years since the 2008 global recession, as Giugale (2015) ix Capital for the Twenty-First Century 279 rate of profit and countertendencies (Ribeiro, Loureiro, & e Albuquerque, 2015) Illustrations of the latter, developed below, include technological revolutions creating new sectors, transforming health and information into commodities, thereby creating a new space for the accumulation of capital and the quality, if not the quantity, of State intervention Coming to our corollary inequality, Piketty might be on target but the reasons lie elsewhere We need to introduce finance Household credit (most of which consists of mortgages in many countries of the world) leads to lower private savings and so slower growth rates (Bezemer, Grydaki, & Zhang, 2015) Au contraire, credit to nonfinancial business has stronger growth effects The policy implication is clear Get your credit destination right and the inequalities might be reversed For the first time, scholars have distinguished between the stocks and flows of credit (Bezemer et al., 2015) Credit flows increase the ability to finance expenditures Loans create deposits and deposits can ignite an increase in transactions (but about this see below) If buying and selling of goods and services and not of assets is the result, GDP increases Credit stocks, on the other hand, are debt stocks The consequence might be large debt servicing out of income and negative wealth effects on consumption SHOCKS AND THE STATE The Treasury Thomas Piketty records turns in the course of history brought about by cataclysmic events like World Wars A downward sloping series can turn sharply giving rise to a U-shaped curve These events have also been occasions when new meaning was infused into organs of the State like Central Banks and Treasuries Thus, the discovery of the long-term government bond in our times is actually a rediscovery (Holtfrerich, 2013; Sinclair, 2011) John Stuart Mill in his Principles acknowledged that government activity contributed to an increase in labour productivity In particular, Carl Dietzel (1829À1884) made the case for issuing government bonds and for using the instruments to put idle labour to work The end of public bonds must be the accumulation of fixed capital stock The increase in output will generate increased savings which can be ploughed back into government bonds without reducing private savings required for private capital accumulation David Hume favoured government bonds In our 280 AMELIA CORREA AND ROMAR CORREA times, James Tobin’s choice between two nominal variables was hallowed in text books Output and capital per head in the long run would be raised We transfer to nominal variables now Also, we introduce government expenditure, G, into the equation Variables without subscripts denote the current period and there will be one-period lagged variables which will be so denoted Thus, Y = C ỵ K K1 ỵ G ð8Þ Assume that government bonds, BL, are held entirely by the private sector We transport ourselves with Piketty to the nineteenth century aristocrats of Jane Austen and Honore´ de Balzac! Disposable income YD, is national income Y minus income taxation, T While the income here would be primarily income from work, with the holding of government securities our worker is also a rentier So, YD = Y T ỵ BL ð9Þ With the holding of bonds, comes capital gains, CG, and denoting wealth by V, the accumulation of wealth is defined as V À V − = YD C ỵ CG 10ị Combing Eqs (9)(11), we get V À V − À BL À CG = K K ỵ G T 11ị The equation resonates with Piketty elements For one thing, the accumulation of capital is mirrored in the accumulation of wealth For another, the tax weapon slices cleanly here A confiscatory tax regime would confiscate the stock of bonds held by rentiers and their capital gains with T = BL + CG The expropriators are expropriated! The consideration of capital gains is important both for an appraisal of Piketty and for independent reasons Weil (2015) shows that, excluding capital gains, the ratio of private wealth to income over the period 1989À2009 would have been 30% rather than 78% The question that arises, then, is whether the smart increase in prices foretells an increase in expected future productivity for reasons such as technological development or a change in the discount rate applied to Capital for the Twenty-First Century 281 future income streams The evidence seems to support the latter conjecture Capital holders grew in the confidence that their assets were safe from confiscation from the State in contrast to the insecurity on that front that plagued them in the middle of the twentieth century None other than Arrow (2013) is even stronger in his claim that RAGE (risk-aversion plus general equilibrium) would not predict the large and volatile swings in the value of stocks that are often experienced Leapfrogging the twentieth century, moving from the 19th to the 21st, assume that the entire stock of bonds is handed over to a Ben Bernanke Recall that the capital terms include private and public investment Our dynamic equation, then, becomes a mix of private and public financial-investment activity Consequently, we can traverse varieties of capitalism for support Thus, in Spain, ethical pension plans are found not to be inferior to traditional investment plans and solidarity pension plans significantly outperform standard pension plans (Marti-Ballester, 2015) One well-known trajectory is the State Capitalism of China that ordained capital-intensive growth in the 2000s (Tai, 2015) The State maintains direct ownership of assets in strategic sectors like energy, telecom, and actively engages in policy designed to promote priority sectors like high-end equipment manufacturing, biotechnology, and alternative energy For the rest, like ‘downstream’ consumer-oriented light manufacturing and export industries, market principles are in play In other countries as well, governments are revisiting nationalisation albeit in a purposeful and nuanced manner as providers of social welfare (Gonzalez-Perez & Sosa, 2015) In the present instance of climbing out of a recession, the Keynes-Kalecki theorem that unemployment is the deficiency of demand for goods, not of labour, must be grasped (Bhaduri, Banerjee, & Moughari, 2015) Income determination is a circular process in which expenditure determines income Aggregate demand, in turn, consists of the level of consumption and investment in a closed economy A redistribution of income in favour of the working class would stimulate demand because of the relatively high propensity to consume of the proletariat The ‘Global Jobs Pact’ of the ILO is all of a piece with our thinking in its scheme of environmentally friendly and labour-intensive public works Projects with direct involvement of local communities help to raise productivity and skills and mitigate ecological problems Eventually, private investment would be ‘crowded in’ The advantage of a wellconceived public works programme is its flexibility and immediate impact Labour can be productive in two ways Either workers build productive assets or skills required for particular ends are enhanced Soil conservation, irrigation and water delivery systems, forestation, flood control, drainage, 282 AMELIA CORREA AND ROMAR CORREA sewage and sanitation are illustrations Local supply would be a major factor in the design of projects and a scheme of warehouses and storing facilities for goods, grain banks, would fit the bill Workers are regarded as participants in the productive activities of society (Green, 2014) Wages are, then, ‘materially instrumental’ in providing adequate income to wage earners to enable them to obtain a fair share of social primary goods The new ICT paradigm is already in place and can be a springboard for innovations in multiple directions as long as demand is forthcoming (Perez, 2014) The State must direct the creation of wealth from the grassroots up Small units, traditional technologies, and special niche products can coexist with the most powerful corporations in the world in the present diversified markets The model can cater directly to the needs of the excluded from ‘frugal innovation’ to infinite adaptability to specific conditions and limitations State Investment Banks (SIBs) are playing a supporting role as private finance for the real economy has vanished Moving to Europe, in a novel construction of the entrepreneurial State, public investments are not intended to fix market failures but actively create them by investing across the investment chain (Langlois, 2015; Mazzucato, 2015; Mazzucato & Penna, 2015; Mazzucato & Wray, 2015) It turns out that the connection between free entry and the current level of profits of firms in an industry is weak Outsiders are motivated by the prospect of high future profits Historically, such expectations are shaped by the ‘Entrepreneurial State’ Thus, the State can be the public venture capitalist in the clean technology sector The idea is that innovation policy should be oriented towards solving the problems of society The public aspect of the bargain never consisted of merely facilitating and removing roadblocks from the path of the private sector Indeed, the State was a visionary, shaping the contours of regime change as part of the process of assuming large societal risks The planning process was not centralised Instead, the policy was translated into blocks that were effected by the joint efforts of public agencies and departments that were entrusted with the task of selecting particular technologies Given the unknowledge underlying a gargantuan task like giving shape to a second green revolution, for instance, institutions had to embrace the unquantifiable uncertainty that came with the job State financial boards must be adjuncts to such programmes, optimising portfolios that permit positive returns from some project to compensate for the losses from others An illustration is the European Commission’s 2010 strategy and the ORCD’s Innovation Strategy for 2010 In short, the plan is to generate growth that is both ‘smart’ (innovation-intensive) and that generates employment It is public Capital for the Twenty-First Century 283 sector funds that fund risky and capital-intensive projects in green technology The reason is that the finance required should not be fickle Public funds have been active from the basic to the applied to the early-stage financing of firms Budgets have been focussed on big-ticket items like tackling climate change Public financial institutions are rising to the task For instance, there is KIW in Germany and the China Development Bank As another example, the National Institutes of Health are funding radical new molecular entities Risk finance for nascent companies is coming from public agencies like the Small Business Innovation Research Program (SBIR) The State has led in the shaping and creation of key ‘General Purpose Technologies’ such as the US mass production systems and information technology It is the State that discovered the opportunity space and guided the commercialisation process At the same time, Gough (2015) constantly reminds us of the deep political economy constraints on the ‘going green’ agenda Nothing short of an energyindustrial revolution is called for Thus, a strategy for consumption would prioritise need-satisfaction over other preferences, non-material satisfaction over material satisfaction, low-carbon satisfiers over carbon-intensive satisfiers The transformation will have to contend with the class conflict between capital and labour In particular, the divisions within the former will be pivotal Countries with large fossil fuel reserves generate huge rents and the attached powerful interests would be opposed to climate change A dynamic will be played out between these forces and ‘green capitalists’ For instance, coordinated market economies with social democratic welfare states tend to promote mutually reinforcing economic and ecological values Now, dropping bonds out of our equations and defining savings S simply as Y À C À T, we get the savings-investment identity I À S=T −G ð12Þ Some followers of Keynes track this relationship closely expressing it as ‘a private sector deficit equals a public sector surplus’ Piketty’s attention is focussed exclusively on the first term on the right-hand side In the event of escalating inequality and Piketty’s measure being a success, we would have a run of budget surpluses meaning a string of private sector deficits Such a process is unsustainable as evidenced in the increased debt holding of private corporations in the tech sector in the nineties (Galbraith, 2010) The pressure to make good generated cash flows on financial commitments through unviable business proposals Obligations were not honoured and 284 AMELIA CORREA AND ROMAR CORREA were repudiated in the slump that followed the crash in the tech sector in the middle of 2000 Naturally, as an automatic stabiliser the signs of the equations changed and government budgets went immediately into deficit mode The Central Bank As a final decomposition of money income, the change in the value of inventories, ΔI, must be included in the measure of total expenditure along with the total money value of final purchases Using a catchall, FE, to denote the latter, Y = FE ỵ I 13ị Inventories have to be paid for by entrepreneurs before receipts roll in The problem of financing working capital arises Labour is, in a sense, a fixed factor of production here (Okun, 1981) Workers are needed to maintain overhead capital; a worker is needed to lubricate an idle machine even in a recession Even with weak demand in product markets, employers would be willing to keep workers on their rolls if they could pay them their marginal physical product Employers can afford to pay the contracted wage in physical units They cannot afford to pay it in money It is not that the real wage is too high It is that the demand for output is too low Production takes time and working capital is essential to effective supply even in the short run Monetary policies crafted to provide sectors starved of it might be a precondition for expansionary fiscal policies to impact production and employment The importance of this step has been elevated to the status of Propositions by Borio (2009) and Buiter (2010) (coincidentally No in both cases!) Central Banks play a financial intermediation role in ensuring funds to those suffering a credit squeeze Herein, we have an explanation for the lengthening of the maturity of Central Bank operations and an increase in their balance sheets Looking backward, despite various evolutionary trajectories of commercial banking systems across the world, the Great Depression and the World War were watersheds (Grossman, 2011) Banking crises engulfed countries in the 1930s Governments promulgated anti-competitive positions aimed at stabilizing their banking systems and directing credit With low interest rates and robust growth, the result was the longest period of banking stability in the western world Capital for the Twenty-First Century 285 Inventory holdings are supported by established credit arrangements with banks Thus, the changed flow of inventories will be backed by a change in loans, ΔL, from a commercial bank The other side of the most stylised bank balance one could think of would consist of deposits, ΔM in incremental terms Finally, the connection with high-powered money, H, is through the reserves ratio, ρ Thus, H = ρM CONCLUSION Numerous imaginative, environmentally friendly, and dignified means to work and consume and build roll out from the innovations conveyor belt Unfortunately, they not fixate the attention of decision makers with the intensity and immediacy they warrant Scale is one issue It is, perhaps, not easy to envision economy-wide employment schemes or a universal minimum wage The connection between these real components and the requisite financial adjuncts have yet to be worked out We think otherwise and have fashioned a framework within which all these elements have a role to play The scholarship of the enterprise derives from the broad sweep of history commanded by Thomas Piketty REFERENCES Arrow, K (2013) Is the market system an efficient bearer of risk? In J Thomas & J W Sargent (Eds.), Macroeconomics at the service of public policy (pp 17À23) Oxford: Oxford University Press Bezemer, D., Grydaki, M., & Zhang, L (2015) Is financial development bad for growth? University of Groningen, Faculty of Economics and Business, Working Paper No 14016-GEM Bhaduri, A., Banerjee, K., & Moughari, K (2015) Fight against unemployment: Rethinking public works programs Real-World Economics Review, 72, 175À185 Borio, C (2009) Ten propositions about liquidity crises BIS Working Paper No 293 Braun, E (2015) The theory of capital as a theory of capitalism À Hidden Austrian contributions to a historically specific approach to capital Unpublished manuscript Broadberry, S., & Gardner, L (2015) Economic development in Africa and Europe: Reciprocal comparisons University of Warwick, Department of Economics, Centre for Competitive Advantage in the Global Economy (CAGE) Working Paper No 232, May Buiter, W H (2010) The limits to fiscal stimulus Oxford Review of Economic Policy, 26, 48À70 286 AMELIA CORREA AND ROMAR CORREA Charles, S., Dallery, T., & Marie, J (2015) Why the Keynesian multiplier increases during hard times: A theoretical explanation based on rentiers’ saving behaviour Metroeconomica, 66, 451À473 Franziani, M., & Pianta, M (2015) Four engines of inequality Institute of Economics Scuola Superiore Sant’Anna Laboratory of Economics and Management Working Paper No 2015/20 Galbraith, J K (2010) The Great Crisis and the American response Levy Economics Institute of Bard College, Policy Brief No 112 Gonzalez-Perez, M A., & Sosa, S (2015) Governments as owners: In nationalisation of international business and social responsibility Advances in Sustainability and Environmental Justice, 17, 219À231 Gough, I (2015) Can growth be green? International Journal of Health Services, 45, 443À452 Green, D A (2014) What is a minimum wage for? Empirical results and theories of justice Institute for Fiscal Studies Working Paper No W14/24 Grossman, R S (2011) The economic history of banking Wesleyan Economics Working Paper No 2011-004 Holtfrerich, C.-L (2013) Government debt in the economic thought of the long 19th century School of Business & Economics, Freie Universitaăt, Berlin, Discussion Paper No 2013/4 Kliman, A (2015) Income inequality, managers’ compensation and the falling rate of profit: Reconciling the US evidence Capital & Class, 39, 287À320 Langlois, R N (2015) Institutions for getting out of the way? A comment on McCloskey Department of Economics, University of Connecticut Working Paper No 2015-12 Marti-Ballester, C.-P (2015) Socially responsible investment: The financial performance of Spanish equity pension plans Advances in Sustainability and Environmental Justice, 16, 103À123 Mazzucato, M (2015) From market fixing to market creating: A new framework for economic policy SPRU Science Policy Research Unit Working Paper No 2015-25 Mazzucato, M., & Penna, C R (2015) Beyond market failures: The market creating and shaping roles of state investment banks Levy Economics Institute of Bard College Working Paper No 831 Mazzucato, M., & Wray, L R (2015) Financing the capital development of the economy: A Keynes-Schumpeter-Minsky synthesis Institute of Economics, Scuola Superiore Sant’Anna Laboratory of Economics and Management (LEM) Working Paper No 2015/14, May Nelson, R., & Consoli, D (2012) An evolutionary theory of household consumption Journal of Evolutionary Economics, 23, 477–501 Nelson, R., & Consoli, D (2015) An evolutionary theory of household consumption Journal of Evolutionary Economics, forthcoming Nikiforos, M (2015) A nonbehavioral theory of savings Levy Economics Institute of Bard College Working Paper No 844 Okun, A M (1981) Prices and quantities: A macroeconomic analysis Oxford: Basil Blackwell Perez, C (2014) The green and socially equitable directions for the ICT paradigm The Global Network for Economics of Learning, Innovation and Competence Building System (Globelics) Working Paper No 2014-01 Piketty, T (2014) Capital in the twenty-first century Cambridge, MA: The Belknap Press of Harvard University Press Ribeiro, L C., Loureiro, P M., & Albuquerque, E de M (2015) Marx, profits and fractal properties UFMG Cedeplar Discussion Paper No 518 Capital for the Twenty-First Century 287 Setterfield, M., & Kim, Y K (2014) Debt servicing, aggregate consumption, and growth University of Massachusetts Boston Working Paper No 2014-10 Sinclair, P (2011) What would Hume make of our current theories of our current economic predicament/and what should we make of his views on government debt? Paper presented at conference on Hume’s influence on Economics: New Perspectives, University of Edinburgh, June 16 Tai, K S (2015) The political economy of state capitalism and shadow banking in China HKUST Institute for Emerging Market Studies Working Paper No 2015-25, May Weil, D W (2015) A discussion of Thomas Piketty’s capital in the twenty-first century American Economic Review: Papers & Proceedings, 105, 34À37 This page intentionally left blank ABOUT THE AUTHORS Eva A´lvarez de Andre´s (PhD) holds a PhD in Urban Planning from the Polytechnical University of Madrid, Spain She previously worked for the Spanish NGO IEPALA between 1997 and 1999 and worked in habitat programs in the Republic of Benin between 1999 and 2003 After finishing her PhD, she has been a lecturer and researcher at the Alfonso X el Sabio University (UAX) (2003À2007), at the Polytechnical University of Madrid (2008À2012), and is since 2013 teaching Urban Planning at the Rey Juan Carlos University in Madrid She has published about the right to housing and to the city She was co-coordinator of the Network-Association of European Researchers on Urbanisation in the South (N-AERUS) between 2010 and 2014 Maria Aristizabal-Ramirez (MA) is an Economist and a Political Scientist and a Masters in Economics from the Universidad EAFIT in Colombia Her main interests are applied microeconomics, economic growth, poverty and inequality She currently serves as Colciencias Junior Researcher at the Centre of Economics and Finance in Universidad EAFIT in Colombia Gustavo Canavire-Bacarreza (MA, PhD) is an Applied Microeconomist whose main interests are applied econometrics, impact evaluation, labour economics and development He currently serves as Director for School of Economics and Finance in Universidad EAFIT in Colombia Previously, he was Research Associate at the International Centre for Public Policy in the Andrew Young School of Policy Studies in Georgia State University He worked at the Federal Reserve Bank of Atlanta, the Social and Economic Policy Analysis Unit (UDAPE À a government advisory unit and public policy think tank in La Paz À Bolivia), the World Bank, the Bolivian statistical office, and the Universidad Cato´lica Boliviana He has been consultant for the Inter-American Development Bank, the World Bank, United Nations, and the governments of Bolivia and Colombia 289 290 ABOUT THE AUTHORS Shaen Corbet (PhD) works as Lecturer in finance at Dublin City University (DCU) Business School in Dublin, Ireland Shaen has previously worked as an equities trader and with the Financial Stability Department of the Central Bank of Ireland He is actively involved in the fields of financial economics, financial markets, crisis and financial stress measurement, crisis management and the effects of crises on financial markets Amelia Correa (MA, PhD) is the Head of the Department of Economics, St Andrew’s College, University of Mumbai She works on financial arrangements to address poverty She has published in Savings and Development, Journal of Economic Integration, Journal of Interdisciplinary Economics, Applied Economics Letters, Philippine Review of Economics, Brazilian Journal of Political Economy, Interdisciplinary Journal of Economics and Business Law, European Journal of Economic Studies, World Review of Political Economy Romar Correa (MA, PhD) is Professor of Monetary Economics in the University of Mumbai He has published in Keio Economic Papers, Journal of Economic Integration, Control and Cybernetics, Discrete Dynamics in Nature and Society, History of Economic Ideas, American Review of Political Economy, International Review of Applied Economics, International Game Theory Review, Evolutionary and Institutional Economics Review, International Journal of Political Economy, Applied Economics Letters, The Economist’s Voice, International Journal of Social Economics, Journal of Philosophical Economics, Journal of Economic Analysis, Journal of Economic Studies, Brazilian Journal of Political Economy Mathematical Economics Letters, Post Keynesian Economics Forum, economics e journal Luis Alfonso Dau (MBA, PhD) is Assistant Professor of International Business and Strategy at the D’Amore-McKim School of Business, Northeastern University His research focuses on the strategic response of developing and emerging market firms to institutional processes and changes He is particularly interested in the impact of pro-market reforms on the international strategy and performance of such firms Fabian Garzon Cuervo (MA) Economist and MA in International Business and Economics Full-time Professor at Politecnico Grancolombiano University, where he lectures on economic history of Colombia and Latin America, International Economics and Economic Policy His research interests include economic history, development policy, and poverty alleviation About the Authors 291 Ioannis Glinavos (LLM, PhD) is Senior Lecturer in Law at the University of Westminster He studied at the University of Essex (LLB) and in Kent (LLM, PhD) before taking a Teaching Fellowship in Law at SOAS, University of London He then held lectureships at Kingston and Reading Universities Ioannis has published two monographs with Routledge (2010, 2013) and a series of articles on Law and Development, Law and Economics and Investment Arbitration He is currently researching foreign investor rights in the context of the economic crisis in the European Periphery Ioannis is also a blogger and commentator on Greek and European politics Maria Alejandra Gonzalez-Perez (Psy, MBS, PhD) is Full Professor of Management at Universidad EAFIT (Colombia) Maria Alejandra is the Vice-President of the Academy of International Business (AIB) (2015À2018) and the coordinator of the Colombian universities in the virtual institute of the United Nations Conference for Trade and Development (UNCTAD) (2009Àpresent) Dr Gonzalez-Perez has published books, over 30 academic papers and book chapters in the areas of internationalisation, business sustainability, corporate social responsibility, and international migration She is a regular contributor to Latin American business media Constantin Gurdgiev (PhD) is Adjunct Professor of Finance with Trinity College, Dublin, and heads his own strategic and macroeconomic advisory practice working with large institutional and professional investors Dr Gurdgiev also acts as a partner in two financial services startups and a co-founder of the Irish Mortgage Holders Organisation In the past, Dr Gurdgiev served as the Head of Research with St Columbanus AG, the Head of Macroeconomics with the Institute for Business Value, IBM, and Director of Research with NCB Stockbrokers, Ltd Carolina Herrera-Cano (IB, MIB) holds a Bachelor Degree in International Business from Universidad EAFIT and holds a Master in International Business in the same institution She is a founding member of the “Observatory on Trade, Investment, and Development” À a research group devoted to the analysis of issues concerning developing countries and which has to date published over 20 analytical columns Carolina has been linked to the study of issues regarding corporate social responsibility, sustainability, and international trade from various research projects at the academia and the private sector She served as conference manager of the 32nd Regional P166 UNCTAD 292 ABOUT THE AUTHORS course on key issues on the international economic agenda for Latin America and the Caribbean À a project at Universidad EAFIT with the support of the Ministry of Foreign Affairs of Colombia Elizabeth Marie Moore (PhDc) is a doctoral candidate at Northeastern University Her research interests include emerging markets and the interplay between systematic political actors and economic development with a specific focus on the determinants and benefits of entrepreneurship within emerging markets amidst a globalizing world Barry Murphy (B.Sc, M.Sc, CFA) holds degrees in Engineering from University College Dublin and Finance from Trinity College, Dublin, and currently holds Level CFA qualification Since 2012, Mr Murphy has been working with Davy Corporate Finance, advising on a wide range of corporate finance mandates with domestic and international, public and private clients Tony Phillips (B.Sc, M.Sc Econ.) is a Financial Economist and Ecologist based in Buenos Aires, Argentina As a scientist, he has two decades of software experience in more than 20 nations in the industrial, financial, communications, and media sectors Between 2003 and 2007, he directed Project Allende, a study of regional economics conducted in Latin America His current focus is on transformative ideas linking finance, growth, energy, development, climate change and sovereign debt His primary degree is in Science, he’s an associate lecturer in the Finance Masters at the University of Buenos Aires (UBA) Recent publications include the book Europe on the Brink; Debt Crisis and Dissent in the European Periphery (Zed Books) with Joseph Stiglitz Maria Alejandra Pineda-Escobar (MA, MSc) is a Consultant and researcher in inclusive business and CSR, working with the Centre of Partnerships for Development (CAD) in Latin America Member of the National Committee of Inclusive Business of Colombia (CONNIC), Regional Coordinator for the Towards the Human City Project in Latin America, and Associate Professor at Politecnico Grancolombiano University, where she lectures on sustainability, globalization and competitiveness in business She has authored several articles, papers and book chapters on CSR and sustainability at the BoP, including her latest participation as one of the contributors in the ground-breaking book “Base of the Pyramid 3.0 Sustainable Development through Innovation and Entrepreneurship.” Professional in International Business holds Masters degrees in Public About the Authors 293 Policy and Human Development (The Netherlands) and in Sustainability and CSR (Spain) Carolyn E Predmore (PhD) is Professor of Marketing She is an active member in the American Marketing Association and Association for Consumer Research Her research interests cover entrepreneurship, innovation and creativity perceptions of ethical issues by business students, retailing and terrorism, salesmanship, Internet usage and retailing on both a national and international basis She has published in the e-learning Digest, Management Decisions, Journal of Business Ethics, Journal of the Association of Marketing Educators as well as having written chapters on entrepreneurship and social media Margaret Soto is currently completing her Masters in Political Science at Northeastern University Her academic interests fall within the scope of international development, international security, and social entrepreneurship Lauren Trabold (PhD) is Assistant Professor of Marketing at Manhattan College She has published a book chapter about consumer health and peer-reviewed journal articles about health and financial decision-making Her research interests include goalbased behaviour change, health, and consumer self-perceptions and their influence on advertising and entertainment preferences Barry Trueick (BComm, MSc) holds degrees from Trinity College, Dublin and the University College, Dublin He currently works with Towers Watson as an investment analyst providing strategy and risk analysis and advisory services for institutional investors Patrik Zapata (PhD) is Associate Professor at the School of Public Administration, University of Gothenburg, Sweden His research examines the management of cities, waste management and waste prevention, sustainable organizing, scandalology, language in organizations, and relations between organizations Marı´ a Jose´ Zapata Campos (PhD) is Associate Professor and Research Fellow at the Gothenburg Research Institute, University of Gothenburg, Sweden She has conducted research in Sweden, Spain, Nicaragua, and Kenya in the fields of urban, development, and organization studies, exploring issues of social and environmental sustainability ... and the red flags and signals that were either missed or ignored Lessons from the Great Recession: At the Crossroads of Sustainability and Recovery Advances in Sustainability and Environmental... question the traditional view of financial and economic systems sustainability in the presence of higher orders of integration of the global monetary and financial systems Overall, data suggest that... look at the BRIC markets indicates that there should be a high level of integration between them and the AEs Bhar and Nikolova (200 7) examine the integration of BRIC countries on a regional and