by Vincenzo Quadrini
University of Southern California
In this commentary I raise some doubts about our readiness to address policy questions about global imbalances. A solid policy analysis requires a well-structured theoretical model that can account for the key empirical facts about imbalances, but progress in this direction is still limited. I also discuss problems associated with the practical implementation of optimal government policies.
JEL Codes: F36, F68.
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