Author: Philip Lane

This new World Bank Policy Research working paper looks at the impact of economics blogs

Summary: There is a proliferation of economics blogs, with increasing numbers of economists attracting large numbers of readers, yet little is known about the impact of this new medium. Using a variety of experimental and non-experimental techniques, this study quantifies some of their effects. First, links from blogs cause a striking increase in the number of abstract views and downloads of economics papers. Second, blogging raises the profile of the blogger (and his or her institution) and boosts their reputation above economists with similar publication records. Finally, a blog can transform attitudes about some of the topics it covers.

Around the time of the EU/IMF deal for Ireland, Patrick Honohan advocated that it would be more effective if the financial risks associated with fixing the Irish banking system could be shared across the European system, rather than just making ‘plain vanilla’ official loans to the Irish government.

In her Jackson Hole remarks, Christine Lagarde agrees:

Second, banks need urgent recapitalization. They must be strong enough to withstand the risks of sovereigns and weak growth. This is key to cutting the chains of contagion. If it is not addressed, we could easily see the further spread of economic weakness to core countries, or even a debilitating liquidity crisis. The most efficient solution would be mandatory substantial recapitalization—seeking private resources first, but using public funds if necessary. One option would be to mobilize EFSF or other European-wide funding to recapitalize banks directly, which would avoid placing even greater burdens on vulnerable sovereigns.

Today’s FT lead article also makes the same point  – but where the EFSF would guarantee funding lines for banks, rather than inject capital.

John Fitzgerald assesses the prospects for the Irish fiscal situation in this Sunday Business Post article.

This VOXEU article looks at some behaviourial motives that influence ‘borrower runs’.

The agenda for this year’s symposium extends far beyond short-term issues. The papers available so far include:

• Dani Rodrik on Convergence
• Esther Duflo on Balancing growth with equity: The view from Development
• Stephen Cecchetti et al on The Real Effects of Debt
• Katherine Baicker and Amitabh Chandra on Aspirin, Angioplasty and Proton Beam Therapy: The Economics of Smarter Health Care Spending