Faculty News
In a co-authored op-ed, Professor Michael Spence demonstrates how China's economic policies contribute to its volatility
—
Excerpt from Project Syndicate -- "... the principal unaddressed problem affecting China’s financial system is the pervasiveness of state control and ownership, and the implicit guarantees that pervade asset markets. This leads to misallocation of capital (with small and medium-size private enterprises struggling the most) and the mispricing of risk, while contributing to a lax credit culture. The absence of credit discipline is particularly problematic when combined with highly accommodative monetary policy, because it can artificially keep zombie companies afloat."
Read more
Read more