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Centre for Development Policy and Research

State of the World Economy

This webpage provides papers produced by the research programme State of the World Economy (SOWE). Initiated in 2005, the programme is currently supported by the Centre for Development Policy and Research (CDPR). It was supported formerly by the International Poverty Centre (IPC) in Brasilia, an institution sponsored jointly by the United Nations Development Programme and the Brazilian Government.

The CDPR programme continues past efforts to promote policy-oriented research that draws on scenarios generated by a new world economic model. The rudiments of the model were developed by members of the Cambridge Economic Policy Group in the 1980s at the University of Cambridge. Drawing on that tradition, Alphametrics Ltd. of Thailand is further developing the model. The director of Alphametrics, Francis Cripps, was a member of the Cambridge group and an originator of the model.

The core of the research programme is the continuing development of a globally integrated databank based on an historically oriented (non-equilibrium) modelling framework. The model’s data cover the period from 1970 to the year for which there are the most currently available data. Calibrated to simulate long-term historical trends, the model is most suitable for making projections 10-15 years into the future.

Started with income, population, energy and trade, the model has been extended to include fiscal, monetary and financial variables, including a more comprehensive account of the balance of payments. Researchers plan to add demographic factors, employment, the distribution of income, and poverty.

The addition of distributional variables will help researchers to identify the probable impact of global economic dynamics on human well-being. Policymakers will also be better able to identify appropriate policy responses.

Capacity development has been a major focus of the State of the World Economy research programme, with training on the model designed primarily for researchers and policymakers in developing countries. Training sessions have already taken place in Brazil, China and India. Further training is planned for Africa.

Following are links to SOWE research papers produced by CDPR and IPC and selected background papers.

CDPR Publications
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Could Employment-Focused Policies Spearhead Economic Recovery in Europe? Policy Brief No. 4

Could Employment-Focused Policies Spearhead Economic Recovery in Europe?

by Terry McKinley and Giovanni Cozzi, CDPR, SOAS

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Fiscal Contraction or Fiscal Expansion in the US: Which Will Promote Growth and Employment?, Development Viewpoint No. 66

by Terry McKinley and Giovanni Cozzi, CDPR, SOAS

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Can Drastic Deficit Reduction Help Economic Recovery?, Development Viewpoint No. 60

by Hannah Bargawi and Terry McKinley, CDPR, SOAS

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A Global Realignment by 2020: U.S. Decline, Emerging Economies Rise

A Global Realignment by 2020: U.S. Decline, Emerging Economies Rise

by Francis Cripps, Director, Alphametrics Ltd and Terry McKinley, Director, Centre for Development Policy and Research

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The Global Benefits and Losses from the US Recession and Recovery Package

The Global Benefits and Losses from the US Recession and Recovery Package

by Francis Cripps, Director, Alphametrics Ltd and Terry McKinley, Director, Centre for Development Policy and Research

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IPC Publications
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Correcting Global Imbalances with Exchange Rate Realignment? No Thanks!

Francis Cripps, Alex Izurieta and Terry McKinley. 2007. IPC One Pager #38, June, Brasilia.

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Developing a Global Model for Trade, Finance and Income Distribution

Francis Cripps, Alex Izurieta and Terry McKinley. 2007. IPC Technical Paper #1, February, Brasilia.

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Addressing Global Imbalances: A Development-Oriented Policy Agenda

Alex Izurieta and Terry McKinley. 2006. IPC Working Paper #23, July, Brasilia.

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The Monopoly of Global Capital Flows: Who Needs Structural Adjustment Now?

Terry McKinley. 2006. IPC Working Paper #12, March, Brasilia.

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Background Papers
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The US Deficit, the EU Surplus and the World Economy

George Irvin and Alex Izurieta. 2006. European Policy Brief, The Federal Trust for Education and Research, March, Issue #24.

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Financial Imbalances in the World Economy

Francis Cripps, John Eatwell and Alex Izurieta. 2005. Economic and Political Weekly, Vol. XL, No. 53, December 24-31. 

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Hazardous Inertia of Imbalances in the US and World Economy

Alex Izurieta. 2005. Economic and Political Weekly, Vol. XL, No.34, August 20-26.

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Balances, Imbalances and Fiscal Targets: A New Cambridge View

Wynne Godley and Alex Izurieta. 2004. Seminar Paper, The Cambridge Endowment for Research in Finance, February, Cambridge.

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A Formal Analysis of the Cambridge Economic Policy Group Model

Francis Cripps and Wynne Godley. 1976. “A Formal Analysis of the Cambridge Economic Policy Group Model.” Economica, New Series, Vol. 43, No. 172, November, pp. 335-348.

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