- On Capitol Hill
- On Wall Street
- In the Press
- Policy Reform Work
Our projects are designed to empower policy makers to create positive change. With a focus on collaboration and outreach, we provide original, standards-based research on key policy issues.
SCEPA joined with the Economic Policy Institute on Capitol Hill to brief congressional staff and policy experts on tax expenditures, or incentives given through the tax code without scrutiny by Congress.
SCEPA economists are working on the prospects for a more progressive economic order to emerge from the shock of the recession. They have published papers and documents that place current events in a longer-term context as well as policy proposals to deal with short-term concerns. They are also documenting the emerging discussion of how the discipline of economics is reacting to the Great Recession and the questioning of conventional economic analysis.
Lance Taylor, a SCEPA Faculty Fellow, presents an overview of his new book, Maynard’s Revenge, in a Google Tech Talk.
The book, published this November by Harvard University Press, is a timely analysis of mainstream macroeconomics, posing the need for a more useful and realistic economic analysis that can provide a better understanding of the ongoing global financial and economic crisis.
The government spends $143 billion through tax breaks in an effort to expand pension coverage and security. Yet, over half of the American workforce does not have a pension. Retirement insecurity hurts business plans, workers’ lives and retiree well-being. Reform is needed.
SCEPA’s Guaranteeing Retirement Income Project, sponsored by the Rockefeller Foundation and in collaboration with Demos and the Economic Policy Institute, has a plan to guarantee safe and secure retirement income for all Americans.
New research by SCEPA Faculty Fellow and Visiting Heuss Professor Stephan Klasen questions the conventional wisdom that women’s participation in the labor force will automatically increase with economic development. Rather, in a paper co-authored with Isis Gaddis, he suggests that the lack of empirical evidence for this theory suggests that proactive measures are needed to promote women’s employment opportunities in developing countries.
The standard hypothesis in development economics is that female labor force participation (FLFP) follows a U-shaped trend as countries develop. Developing countries initially have high rates of female labor participation, due to poverty and the ability to combine domestic and agrarian work. As these countries develop, female participation falls because women’s social, cultural, and economic barriers make it difficult for women to find work in the industrial sector. As countries get richer, these trends are reversed again, largely due to increases in female education, fertility decline, and a slow dismantling of the structural and social barriers against female employment.
Klasen’s work finds that this U-shaped trend vanishes when using advanced econometric techniques such as dynamic panel estimations and depends on the data sources used. Moreover, the differences in the level of female participation among different countries is related to historical and cultural aspects. For example, female labor force participation rates in Sub Saharan Africa are substantially higher than predicted by the U-theory due to the strong roles women play in agriculture. Rates are also much lower than predicted in the Middle East and North Africa, with women’s participation linked to economic structure and societal barriers to employment.
On May 16, 2013, SCEPA Director Teresa Ghilarducci joined a panel discussion hosted by the Economic Policy Institute (EPI) on Robert Kuttner's new book, Debtor’s Prison: The Politics of Austerity Versus Possibility. Below are her comments on the structural shift of risk:
"The last 20 years has seen significant growth and change in the character of interactions between working and middle-class households and financial institutions and markets.1
With this financial development and households' increased exposure to financial risk, academic economists and others have embarked on a new inquiry, a body of study some call the "culture of finance." This is the name of an NYU seminar taught this summer featuring business faculty, anthropologists, and investment bank economists. Other scholars call this line of inquiry the "financialization of households," and even others embed it in literature as the "culture or varieties of capitalism" (see among others David Soskice and Peter Hall).2
Generally, the project seeks to understand how and why individuals and households are taking on more and more economic risk. These risks were once managed by government and employers, and sometimes social insurance arrangements or employee benefits, such as pension plans, unemployment insurance, and default risk by banks. These institutions have been replaced by financial institutions and products, and are key to the story of how corporations and banks have shifted the risk of financial loss to households.
The fact that the U.S. retirement system is in crisis is no secret here or abroad. On May 14, 2013, The New York Times article How They Do It Elsewhere by Steven Greenhouse highlighted a recent Mercer study that graded the retirement systems in the advanced industrialized countries. Not surprisingly, the U.S. received a mediocre C. Considering that the retirement system is failing millions of Americans each year, one might wonder if they graded on a curve.
Every country is worried about investing retirement funds correctly, and every country wants to minimize risks to the taxpayer so there aren’t large, unknown bills in the future. In the United States, we use our tax code far more than other countries to encourage savings and other socially beneficial behavior. We spend billions of dollars to incentivize saving for retirement through 401(k)’s and I.R.A.’s. That costs us a huge amount of money without much effect in creating a secure retirement system. In fact, America’s voluntary system means that nearly six out of 10 workers are not in pension or 401(k) plans.