Bulletin June 2007

IN THIS ISSUE...

Das Kapital - how the German elite are winning from globalisation
Globalisation is the scapegoat for a litany of economic ills, but one of the most persistent complaints against it is that in developed countries, the integration of world markets brings bumper rewards for those at the top of the income scale, while punishing less skilled workers at the bottom. Two new CEPR Discussion Papers show that unlike many of the charges against globalisation, this one has some justification.

The Blessings of Bad Geography in Africa
Mountainous terrain is tough to farm, costly to traverse, and often inhospitable to live in; yet in Africa, countries with a rugged landscape tend to perform better than their flatter rivals. To explain this paradox, CEPR Research Fellow Diego Puga and his co-author Nathan Nunn reach back more than two centuries - to the slave trade.

Spiralling oil prices: the (un)shocking truth
Oil shocks have a chilling reputation for wrecking economies, CEPR Research Fellow Lutz Kilian and his co-author Paul Edelstein look at exactly how changes in the oil price affect the economy, and discover that the declining size of America's once-mighty auto sector has actually helped to contain the effects of an oil shock on the wider economy.

Corporate governance: virtue is its own reward
'Compliance' with tightening legal constraints on corporate governance has become an increasingly onerous part of the day-to-day running of big businesses, and many companies complain about the costs of tightening up their procedures. Two new CEPR research papers provide evidence that it's worth their while: better corporate governance means a higher stock market valuation - and healthier financial performance.