Keys to Prosperity Free Markets, Sound Money, and a Bit of Luck

by Dornbusch, Rudiger

• ISBN13: 9780262541367
• ISBN10: 026254136X
• Edition: Reprint
• Format: Paperback
• Copyright: 2002-02-22
• Publisher: The MIT Press

Summary

The underlying theme of Rudi Dornbusch's work is unabashedly Chicago, namely, the University of Chicago belief that markets solve problems best and that most bureaucrats, even when well-intentioned, are distracted by politics or excessive zeal for perfect solutions. Dornbusch seeks to challenge those in charge with alternative answers and to limit their ambitions. He takes aim at central bankers, bureaucrats, unions, do-gooders, and politicians from Brazil, Japan, Russia, and other scenes of economic disaster. This book collects Dornbusch's recent commentaries from such publications as Business Week, the Wall Street Journal, and the Financial Times, as well as longer essays from recent and forthcoming books. The pieces focus on issues of domestic and international economic policy, including inflation and debt, exchange rates, trade policy, emerging markets, and the intersection of politics and economics. The writing is lively, opinionated, and informative.

Author Biography

The late Rudiger Dornbusch was Professor of Economics at the Massachusetts Institute of Technology.

Table of Contents

Preface	ix
I The Big Picture	1	(38)
A Century of Unrivaled Prosperity	3	(22)
The Come and Go of the State	25	(14)
II Macroeconomic Ingredients for Growth and Prosperity	39	(38)
Long-Run Growth in Emerging Countries	41	(6)
Containing High Inflation	47	(10)
Free Markets Work Best---But They Need a Little Tweaking	57	(4)
And You Thought Social Security Was in Trouble...	61	(4)
Growth Forever	65	(4)
Germany's Economic Future	69	(8)
III Global Financial Markets: Ideas Whose Time Has Come	77	(76)
Capital Controls: An Idea Whose Time Is Gone	79	(8)
Why Bailouts Are Bad Medicine	87	(4)
Check the Laws Before You Invest Abroad	91	(4)
How the Fed Can Tame the Savage Currency Markets	95	(4)
The Effectiveness of Exchange-Rate Changes	99	(22)
No Way to Rescue the Greenback---And No Need To	121	(4)
Lessons from the Mexican Crisis	125	(4)
After Asia: New Directions for the International Financial System	129	(12)
The Target Zone Controversy	141	(6)
New Challenges for World Financial Markets	147	(6)
IV No Apologies for Free Trade	153	(40)
Is Free Trade at a Crossroads?	155	(6)
2005: A Trade Odyssey	161	(10)
U.S.-Mexico Free Trade: Goods Jobs at Good Wages	171	(10)
U.S.-Japan Relations Fifty Years after Pearl Harbor	181	(8)
Trade with China: Add Bite to America's Bark	189	(4)
V European Union: Fantasies, Problems, and Impact	193	(52)
Euro Realities, Fantasies, and Problems	195	(16)
EMU: Will It Happen, Will It Not, and What Difference Does It Make?	211	(6)
If the Franc Falls, So Will Europe's Dream of a Common Currency	217	(4)
Why the Mighty Mark Is a Sitting Duck	221	(4)
Europe's Money: Implications for the Dollar	225	(12)
Fifty Years Deutsche Mark	237	(4)
Scenarios for Europe	241	(4)
VI A Latin Disease? Or Triangle?	245	(64)
The Latin Triangle	247	(18)
Mexico--The Folly, the Crash, and Beyond	265	(16)
Another Peso Disaster May Be Waiting in the Wings	281	(4)
Brazil Has Run Out of Excuses	285	(4)
Argentina's Monetary Policy Lesson for Mexico	289	(4)
How Not to Safeguard South Africa's Democracy	293	(4)
Mexico Should Ditch the Peso for the Dollar	297	(4)
Brazil's Policy Options for the Second Term	301	(4)
Brazil Beyond Tropical Illusion	305	(4)
VII The East Asian Miracle, Not Quite	309	(30)
Paper Tigers, the IMF, and the World Capital Market	311	(4)
Way Is Japan Shooting Itself in the Foot?	315	(4)
What's the Weakest Link in the World Economy? Japan	319	(4)
Mexico Learned Its Lesson. Now, Will East Asia?	323	(4)
A Bailout Won't Do the Trick in Korea	327	(4)
An Achilles' Heel That Could Cripple China	331	(4)
Next, China?	335	(4)
VIII Good People and Bad Ideas	339	(12)
A Requiem for Chancellor Kohl	341	(2)
Oskar Is Trouble	343	(4)
The Crisis of Global Capitalism: Mixed Praise for Soros	347	(4)
Index	351