Past experience suggests that multifunctional banking is the leading source of financial crisis, while large bank size contributes to contagion and systemic risk. This indicates that resolving large banks will not solve the problems associated with multifunctional banking--a conclusion reached...

The nation's economic challenges are daunting. Restoring robust American prosperity and widespread economic opportunity will not be easy. But, as Hyman Minsky stressed, "Economic systems are not natural systems…. Policy can change both the details and the overall character of the economy."...

The developed world faces a cyclical deficiency of aggregate demand, the product of a liquidity trap and the paradox of thrift, in the context of headwinds born of ongoing structural realignments. According to Paul McCulley, PIMCO, front-loaded fiscal austerity would only add to that...

Is it sufficiently realized how intractable those U.S. imbalances -- and how dangerous their potential consequences at home and abroadÑhave now become?

The time has more than come to begin planning seriously for the aging of the baby boom generation. The need for planning goes beyond concerns about the solvency of Social Security and Medicare. Another crisis looms in the form of a huge bill for the care of baby boomers who in their old age will...

There is a strategic need, if a "growth recession" is to be avoided, for a new motor to drive the economy, particularly if there is a further decline in private expenditure relative to income that could generate a further hole in aggregate demand.

Modest sales expectations and limited access to bank credit may be curtailing small businesses' plans for hiring and capital investment.

Growing government surpluses, a ballooning trade deficit, and the resulting growth in private sector debt have placed the U.S. economy in a precarious position. Papadimitriou and Wray agree with President George W. Bush that fiscal stimulus is necessary to reinvigorate the economy; in the...

In this Special Report, Levy scholars Ajit Zacharias, Thomas Masterson, and Kijong Kim provide a preliminary assessment of the 2009 American Recovery and Reinvestment Act (ARRA), a package of transfers and tax cuts that is expected to provide relief to low-income and vulnerable households...

A simple consideration of history tells us that each new piece of legislation contains loopholes that benefit a new class of entrepreneurs; some of these loopholes are small, but others are such that one could drive a bullion-laden truck through them. In this new Policy Note, Martin Shubik...