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Stock market falls in 1970 after Wall Street crisis. War related inflation and high interest rates prevail. Paul Volcker assumes control at Fed. Historically high interest rates. High value of the dollar. Market retreats below 1,000 on DJIA. Record yields on Treasury bonds, economic stimulus package from Washington.

Market rises after stimulus package from Washington. Mergers trend begins in 1982 with corporate raiding. Stock market rout in 1987 and S&L crisis a year later. Junk bond trend emerges. Michael Milken found guilty and sentenced. Bull market resumes during Clinton years and bubble reaches historic highs on DJIA. Mergers continue unabated. Greenspan becomes Fed chairman.

Diverse groups are a hotbed for free riders. This chapter thus tests whether fiscal policy coordination was marred by collective action failure. The central claim of this chapter is that accusations of stability or growth free riding are not borne out by factual evidence. Using regression analysis and Qualitative Comparative Analysis, the chapter shows that despite their greater ability to free ride (given their political clout and trade links), larger and more open economies implemented larger stimulus programs. Fiscal policy is further analyzed vis-à-vis a country’s fiscal space. Results show that, by and large, member states stimulated their economies in line with their fiscal room for maneuver. These findings are contrasted with the political discourse of the time, when indictments of growth free riding were widespread. Accusations of beggar-thy-neighbor politics were rife; first-order free riding was not.

This chapter reviews the arguments made by green growth advocates in support of the view that climate change mitigation can provide the basis for a new wave of growth. The review shows that most of these arguments do not hold up to scrutiny. Investment in clean energy technologies may generate new jobs, and can help sponsor new domestic industries. But green energy does not, to date, offer novel material—as opposed to environmental—advantages above the brown energy it replaces. As such, the economic argument for green energy as a transformative engine of growth falls short. Consequently, most green growth success stories depend on external factors, such as Keynesian stimulus during recessions or export-led growth in green technology, to generate economic surplus. These shortcomings suggest serious economic and political risks for green growth, absent serious efforts to discover the economic advantages of low-emissions technology.

This chapter presents a couple of “Keynesian” theories of the impact of redistribution, which claim that marginal tax rates have no effect on work hours during a recession, and that work hours are stimulated by any policy that puts resources in the hands of the poor and unemployed. The chapter explains how the fundamental differences between Keynesian approaches and mine are a matter of testable assumptions, and concludes with a simple econometric framework that embeds all of them. The relevant parts of that econometric model are estimated in the next chapter.

Initially, many believed that China would not be affected by the international financial crisis. In fact, some even believed that China would be the one to relieve the world from its troubles. Prime Minister Wen Jiabao stated that he was confident that the 10 years of reform that the country had recently undergone would render it stable and would mean it would be able to endure the crisis. Also, this belief was furthered by a US$586 billion economic stimulus package that had been introduced in November 2008. Even after officials realized that the ability to maintain a stable export growth of manufacturing goods was in sharp decline, confidence persisted. The country continued to accumulate foreign reserves and its banks did not collapse. However, the banking industry appeared to be still susceptible to adverse effects, and the size of the country's financial system hindered policy-making. Also, competition had to be controlled and the role of foreign banks had to be restricted.

This chapter sets out to examine the determinants of fiscal policy outcomes during the Great Recession. EU members form a diverse union. What are the implications of economic and political diversity for public finances and by implication for collective action? To answer this question, this chapter analyzes time-series cross-sectional, country-level data from the twenty-seven EU member states over a three-year period (2008–10). The empirical analysis asserts that the deficit bias attributed to contemporary public finances was stronger during the Great Recession. Political factors (amongst them partisanship, the electoral calendar, and the strength of government) have shaped public finances markedly.

The hope expressed by the African American reformers during 1919 was brought about mainly because of how several African Americans were mobilized during the war. Although war mobilization initiated a military draft, labor shortages, training, and presented various opportunities for employment for those in South Carolina, these changes posed threats for the existing racial hierarchy in the area. While the black reformers saw the war as a catalyst for change, the white reformers perceived this as a way to generate profit, new capital, and to identify the shortcomings of the state. Since the whites resisted political instability, all of the changes experienced were made to comply with expressions of white social control. This chapter identifies how war mobilization could not be controlled since African Americans initiated the change, the war-related demands of the federal government were in conflict with the interests of the whites, and the marketplace's invisible hand generated economic stimuli that veered away from social control.

This chapter examines the welfare to work policies of the Coalition government, noting both continuities and changes with those of New Labour. It observes that while the principles of activation pursued by New Labour governments have been retained by the Coalition, the latter's distinctive policies have involved the proposed transformation of all working age benefits into a ‘Universal Credit’ and the introduction of a single ‘Work Programme’, under which the scale and pace of the outsourcing of job placement services to private contractors will be increased. It argues that New Labour's activation policies achieved relative success, during a period of economic growth, in reducing unemployment and poverty, and that together with economic stimulus and other measures introduced during the recession they were able to mitigate the rise in unemployment when compared to previous recessions.

This chapter presents and discusses the New Deal offered by President Franklin D. Roosevelt to America in response to the collapse of the nation's economic and social institutions. Roosevelt set out to stabilize American capitalism through regulation of the nation's financial and manufacturing sectors, the implementation of policies to promote both higher wages and workers' rights, and the introduction of economic stimulus packages. Though the New Deal's overarching aim was simply to right a listing economy, the president's recovery efforts profoundly altered the meaning of American democracy. As historian Nelson Lichtenstein has demonstrated, New Dealers institutionalized a form of republican government that sought to restrain the inequities associated with industrial capital by empowering the citizenry.