A rigorous, thorough work that should help finance students prepare for major changes.

FINANCIAL SERVICES IN THE TWENTY-FIRST CENTURY

THE PRESENT SYSTEM AND FUTURE DEVELOPMENTS IN FINTECH AND FINANCIAL INNOVATION

A panoramic textbook covers an international financial landscape newly drawn by crisis, technology, and transformation.

According to Burke, the financial cosmos has radically changed since the global crisis of 2008. In the wake of the pressures of Covid-19, the “public institutional infrastructure” is poised to continue its transformation. The structure provided by the Bretton Woods Conference during World War II has been collapsing, and major institutions like the International Monetary Fund and the World Trade Organization are “warped” versions of their former selves. In addition, there is a shift underfoot to a less unipolar world, one in which Brazil, Russia, India, and China ascend to economic prominence, leaving G7 nations imperiled. Meanwhile, fintech, the rise of artificial intelligence, and the growing popularity of cryptocurrency function as agents of disruption in this “environment of incessant change.” As the author astutely observes, fiscal institutions and forms of financial regulation are not immutable, and any approach to understanding them must account for their susceptibility to change: “Central banks and financial services institutions are human creations and are not the function of tentatively valid scientific generalizations. Therefore, they may be changed and replaced to serve the public good, without becoming public institutions.” Nevertheless, Burke doesn’t assume that everything will change, resisting the current fashion to announce the grand reinvention of everything; for example, he predicts that the United States dollar’s hegemony will persist unabated in the foreseeable future.

This is an academic textbook designed to be used for classroom instruction and so the chapters are appropriately (and impressively) synoptic, each ending with a helpfully concise conclusion and an assemblage of discussion questions for students. The material explored is, as readers might expect, technically forbidding. But Burke manages not only to provide remarkably accessible treatments of complex subjects, but also furnishes useful illustrative tools like graphs and charts as well as a bibliography pointing the way to further study. The book is admirably comprehensive: Readers will find discussions of Bitcoin and economic inequality, monetary theory, and the repercussions of online banking. In addition, Burke is unafraid to challenge existing orthodoxies, showing a refreshing lack of intellectual piety for academic conventions. For example, he meticulously demonstrates the empirical weaknesses of the widely accepted “financial circular flow model” as an account of the role of banks and explains why some dominant theories about money are indefensible. Money, he asserts, is “surely one of the most perplexing inventions of human society.” Additionally, the United Nations is portrayed as an obstacle to a more multipolar world, attached to “vested interests rooted in history.” Burke is not immune to the allure of the occasional banality—after comparing the wealth of Jeff Bezos to a Vietnamese shrimp-peeling worker, he muses: “A question arises: for whom then does the financial system toll? The question is immensely complicated but prosaic observations enlighten.” It’s unclear what enlightenment is delivered here, especially disappointing since the discussion he presents of financial inequality in the context of an assessment of economist Thomas Piketty’s “analytical historical narrative” is empirically judicious. But overall, this is a textbook that should be widely adopted—Burke examines all the relevant major issues in a way that considers the new demands and opportunities of a rapidly shifting world.

A rigorous, thorough work that should help finance students prepare for major changes.

Pub Date: July 6, 2021

ISBN: 978-3-03-063966-2

Page Count: 236

Publisher: Palgrave Macmillan

Review Posted Online: Sept. 21, 2021

Kirkus Reviews Issue: Nov. 15, 2021

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Occasionally wonky but overall a good case for how the dismal science can make the world less—well, dismal.

GOOD ECONOMICS FOR HARD TIMES

“Quality of life means more than just consumption”: Two MIT economists urge that a smarter, more politically aware economics be brought to bear on social issues.

It’s no secret, write Banerjee and Duflo (co-authors: Poor Economics: A Radical Rethinking of the Way To Fight Global Poverty, 2011), that “we seem to have fallen on hard times.” Immigration, trade, inequality, and taxation problems present themselves daily, and they seem to be intractable. Economics can be put to use in figuring out these big-issue questions. Data can be adduced, for example, to answer the question of whether immigration tends to suppress wages. The answer: “There is no evidence low-skilled migration to rich countries drives wage and employment down for the natives.” In fact, it opens up opportunities for those natives by freeing them to look for better work. The problem becomes thornier when it comes to the matter of free trade; as the authors observe, “left-behind people live in left-behind places,” which explains why regional poverty descended on Appalachia when so many manufacturing jobs left for China in the age of globalism, leaving behind not just left-behind people but also people ripe for exploitation by nationalist politicians. The authors add, interestingly, that the same thing occurred in parts of Germany, Spain, and Norway that fell victim to the “China shock.” In what they call a “slightly technical aside,” they build a case for addressing trade issues not with trade wars but with consumption taxes: “It makes no sense to ask agricultural workers to lose their jobs just so steelworkers can keep theirs, which is what tariffs accomplish.” Policymakers might want to consider such counsel, especially when it is coupled with the observation that free trade benefits workers in poor countries but punishes workers in rich ones.

Occasionally wonky but overall a good case for how the dismal science can make the world less—well, dismal.

Pub Date: Nov. 12, 2019

ISBN: 978-1-61039-950-0

Page Count: 432

Publisher: PublicAffairs

Review Posted Online: Aug. 29, 2019

Kirkus Reviews Issue: Sept. 15, 2019

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A cleareyed, concise look at current and future affairs offering pertinent points to reflect and debate.

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TEN LESSONS FOR A POST-PANDEMIC WORLD

The CNN host and bestselling author delivers a pithy roundup of some of the inevitable global changes that will follow the current pandemic.

Examining issues both obvious and subtler, Zakaria sets out how and why the world has changed forever. The speed with which the Covid-19 virus spread around the world was shocking, and the fallout has been staggering. In fact, writes the author, “it may well turn out that this viral speck will cause the greatest economic, political, and social damage to humankind since World War II.” The U.S., in particular, was exposed as woefully unprepared, as government leadership failed to deliver a clear, practical message, and the nation’s vaunted medical institutions were caught flat-footed: "Before the pandemic…Americans might have taken solace in the country’s great research facilities or the huge amounts of money spent on health care, while forgetting about the waste, complexity and deeply unequal access that mark it as well." While American leaders wasted months denying the seriousness of Covid-19 and ignoring the advice of medical experts, other countries—e.g., South Korea, New Zealand, and Taiwan—acted swiftly and decisively, underscoring one of the author's main themes and second lesson: "What matters is not the quantity of government but the quality.” Discussing how “markets are not enough,” the author astutely shoots down the myth that throwing money at the problem can fix the situation; as such, he predicts a swing toward more socialist-friendly policies. Zakaria also delves into the significance of the digital economy, the resilience of cities (see the success of Hong Kong, Singapore, and Taipei in suppressing the virus), the deepening of economic inequality around the world, how the pandemic has exacerbated the rift between China and the U.S. (and will continue to do so), and why “people should listen to the experts—and experts should listen to the people."

A cleareyed, concise look at current and future affairs offering pertinent points to reflect and debate.

Pub Date: Oct. 6, 2020

ISBN: 978-0-393-54213-4

Page Count: 320

Publisher: Norton

Review Posted Online: Aug. 27, 2020

Kirkus Reviews Issue: Sept. 15, 2020

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