1. Take a side in this debate:
Anders Aslund, “Why Austerity Works and Stimulus Doesn’t,” http://www.bloomberg.com/news/2013-01-07/why-austerity-works-and-fiscal-stimulus-doesn-t.html
Ha JonnChang, “Austerity Has Never Worked,” http://www.guardian.co.uk/commentisfree/2012/jun/04/austerity-policy-eurozone-crisis
2. Blyth suggests that rather than cut spending we are better off increasing taxes at the top. But here’s an alternative Keynesian take: “Since households spend more when they feel wealthy, one way to get people back to work is to reflate the asset markets. Central banks and treasuries should actively intervene to reflate the asset market bubble. A further increase in equity prices, engineered by government, will benefit us all. As the economy recovers, employment will rise, tax revenues will rise and the need for austerity will fade. For example, the Bank of England, backed by the Treasury, does not need to print money to restore full employment – a move that would potentially be inflationary. They need simply to absorb the risky assets that private markets are unable to absorb by swapping debt for equity held by the public.” So forget taxes on the top 1-10 percent, as Blyth argues, An asset bubble in a recession is Keynesian indeed. Comment.
3. In this video Keynes’ biographer says we should postpone thoughts about debt, given the circumstances. How would Blyth comment?
4. In what some regard as THE book on finance, Anat Admati argues that the banks’ business model is over. How does her assessment differ from Blyth’s?
5. Could the eurozone crisis have been avoided and if so how?
6. Are Europeans right to blame the Americans for the crisis that struck Europe?
7. What are the main mechanisms of Wolf’s explanation of the European crisis?
Make sure you watch the video with the keynote speaker.