Jeffrey Sachs

Columbia University, The Earth Institute, Faculty Member

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University Professor at Columbia University, Director of the Center for Sustainable Development, Director of the UN Sustainable Development Solutions Network, SDG Advocate
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University of Ljubljana

Alessandro Fabbrini

Tamas Reti

Štefan Bojnec

University of Primorska, Faculty of Management

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Papers by Jeffrey Sachs

6 Political Independence and Economic Reform in Slovenia

RePEc: Research Papers in Economics, 1994

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The views expressed herein are those of the authors and do not necessarily reflect the views of t... more The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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9. Alternative Approaches to Financial Crises in Emerging Markets

Capital Flows and Financial Crises, 2019

Developing countries fall into international financial crises for a variety of reasons, including... more Developing countries fall into international financial crises for a variety of reasons, including fiscal profligacy, exchange rate mismanagement, international financial shocks, financial liberalization, and weaknesses in the domestic banking sector. Market expectations may play an independent role in a financial crisis, by triggering a self-fulfilling financial panic. International public policy should be aimed first and foremost at avoiding financial crises, but must also be prepared to ameliorate financial crises after they begin. Despite ample experience with financial crises in the past decade, there are still serious differences of opinion with regard to best means of their avoidance, and their proper management once they occur. These difference relate to the appropriate roles of exchange rate policy, banking policy, fiscal policy, and the international institutions. The purpose of this paper is to review the lessons of the past decade, in order to draw some policy conclusions for developing country governments and for international institutions such as the IMF, World Bank, and the Bank for International Settlements.

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Implementing Debt Relief for the HIPCs

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A Global Compact to End Poverty: Jeffrey Sachs on Stabilisation, Transition and Weapons of Mass Salvation

The World Economy, 2005

It is wrong that somebody's chances in life depend so starkly not on their talents or ambitio... more It is wrong that somebody's chances in life depend so starkly not on their talents or ambitions or how hard they work, but on where they were born. Those of us who believe that everyone—not just a few—should have the chance to fulfil their own potential, cannot stand by and watch Africa be left behind by the rest of the world. Our generation is heir to two and a half centuries of economic progress. We can realistically envision a world without extreme poverty by the year 2025 because technological progress enables us to meet basic human needs on a global scale and to achieve a margin above basic needs unprecedented in history… Remarkably, contrary to the dark vision of Thomas Malthus, we can accomplish all this with a world population that is eight times higher than in 1750.

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The Limits of Convergence

Polymers are rendered more resistant to oxidation by the incorporation of a compound containing a... more Polymers are rendered more resistant to oxidation by the incorporation of a compound containing at least one phosphate grouping in which the phosphorus atom and at least two of the three oxygen atoms attached thereto by single covalent bonds form part of a cyclic structure, the remaining atoms in the ring being carbon atoms, such that when only two of the three said oxygen atoms form part of a cyclic structure the third said oxygen atom is attached to hydrogen, a metal, a metalloid group, an alkyl or substituted alkyl radical or a hindered aryl radical. The compound may be formed in situ in the polymer from a precursor in which one of the -C-O-P- links of the cyclic structure is replaced by -C-OH HO-P-, or from an organo-soluble metal salt and a hydroxyphosphate corresponding to the antioxidant.

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EU Membership for Central Europe: Commitments, Speed and Conditionality

This paper givers a motivation and a mothod for a fast intergration of the reforming countries of... more This paper givers a motivation and a mothod for a fast intergration of the reforming countries of central Europe into the European union. The motivation is based on a model of self-fulfilling prophecies where the expectation of entry can trigger the coordination of expectations towards a fast-growth, catch-up equilibrium, and help central Europe avoid the stagnation equilibrium. The method is a set of conditions and a target date which ensure that the new members will not destabilize the Union but contribute to its development.

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Making Carbon Taxation a Generational Win Win

Carbon taxation has been studied primarily in social planner or infinitely lived agent models, wh... more Carbon taxation has been studied primarily in social planner or infinitely lived agent models, which trade off the welfare of future and current generations. Such frameworks obscure the potential for carbon taxation to produce a generational win-win. This paper develops a large-scale, dynamic 55-period, OLG model to calculate the carbon tax policy delivering the highest uniform welfare gain to all generations. The OLG framework, with its selfish generations, seems far more natural for studying climate damage. Our model features coal, oil, and gas, each extracted subject to increasing costs, a clean energy sector, technical and demographic change, and Nordhaus (2017)'s temperature/damage functions. Our model's optimal uniform welfare increasing (UWI) carbon tax starts at $30 tax, rises annually at 1.5 percent and raises the welfare of all current and future generations by 0.73 percent on a consumption-equivalent basis. Sharing efficiency gains evenly requires, however, taxing future generations by as much as 8.1 percent and subsidizing early generations by as much as 1.2 percent of lifetime consumption. Without such redistribution (the Nordhaus "optimum"), the carbon tax constitutes a win-lose policy with current generations experiencing an up to 0.84 percent welfare loss and future generations experiencing an up to 7.54 percent welfare gain. With a six-times larger damage function, the optimal UWI initial carbon tax is $70, again rising annually at 1.5 percent. This policy raises all generations' welfare by almost 5 percent. However, doing so requires levying taxes on and giving transfers to future and current generations ranging up to 50.1 percent and 10.3 percent of their lifetime consumption. Climate change presents grave risks to current and future generations. The perils include drought, extreme storms, floods, a rise in sea level, intense heat, wildfires, pollution, desertification, the spread of disease, earthquakes, tsunamis, a rise in ocean acidity, the proliferation of insects, and mass extinctions. Anthropogenic global warming, associated with the human release of carbon into the atmosphere, is widely viewed as the primary cause of climate change. According to NASA 1 , carbon dioxide in the atmosphere has increased by one third since 1950 and is now at its highest level in 650,000 years. Since 1880, the planet's average temperature has risen by 1.8 degrees, minimum levels of Arctic ice are declining by 12.8 percent per decade, 413 gigatonnes of ice sheets are melting annually, and the sea level may rise 8 feet by 2100. The 2018 U.S. Government's National Climate Assessment projected potentially massive costs to the economy, the ecosystem , health, infrastructure, and the environment. 2 Recent estimates put 2100 climate damages at one quarter of global GDP. 3 This paper develops a large-scale OLG climate-change model to study generational win-wins available from carbon taxation. The OLG model appears better suited for studying carbon taxation than the standard frameworks-the social planner and infinitely-lived agent models. In the OLG framework, generations are selfish. Hence, their imposition of negative externalities on future generations comes naturally. The OLG framework also highlights a key point that has been obscured in all but a few analyses of carbon taxation. Carbon taxation, coupled with appropriate intergenerational redistribution, can make all current and future generations better off. Indeed, it can make them uniformly better off. Our OLG model has 55 overlapping generations. A single consumption good (corn) is produced with capital (unconsumed corn), labor, and energy. Energy is clean or dirty. Clean energy is produced using capital, labor, and fixed natural resources (e.g., windy areas), which is proxied by land. Labor and land are in fixed supply. Corn and clean energy experience technical change (TFP growth), which can proceed at permanently different rates. Apart from our energy supply side and OLG preferences, our model matches Nordhaus'(2017). In particular, it adopts Nordhaus' modeling of carbon emissions, temperature change, and temperature-induced economic damage. It also incorporates Nordhaus' projections of global population with appropriate assumptions about its distribution by birth cohort. As in Golosov et al. (2014), we explicitly model dirty energies, in our case coal, oil, and natural gas. 4 Each has finite reserves and each is subject to increasing extraction cost. We use Auerbach and Kotlikoff's (1987) lump-sum redistribution authority (LSRA) to derive the largest uniform (across all current and future generations) welfare increasing (UWI) carbon tax, where welfare changes are measured as compensating consumption differentials. We also present results for two alternative means

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Globalization—In the Name of Which Freedom?

Humanistic Management Journal, 2017

I consider four waves of globalization. The first is Commercial Capitalism (1500-1800), following... more I consider four waves of globalization. The first is Commercial Capitalism (1500-1800), following the voyages of Columbus and Da Gama. The second is Industrial Capitalism (1800-1950), following the industrial revolution led by the steam engine and mechanization. The third is the Era of Convergence (1950-Present), following the end of the European empires after World War II. The fourth is the New Globalization (Present-2100) marked by three decisive trends: the relative rise of Asia, the Information Revolution, and the stark crises of Planetary Boundaries. I argue that modern globalization must urgently establish a new moral basis and the cultivation of virtues in order to achieve Sustainable Development.

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A new global consensus on helping the poorest of the poor

There is an urgent need for a new consensus on economic development. The World Bank and the Inter... more There is an urgent need for a new consensus on economic development. The World Bank and the International Monetary Fund should take notice when many of their natural supporters have become their ardent opponents. The truth is that much of the criticism is misplaced. The Bretton Woods institutions are bearing the brunt of the fact that the rich countries, especially the United States, have largely turned their backs on the world's poorest people. But the Bretton Woods institutions have been willing accomplices in the dismantling of an effective agenda against global poverty alleviation. Since these institutions are owned and operated by their shareholders, with a clear majority held by the United States and Europe, both the IMF and the World Bank have defended the ever-shrinking and unrealistic development agenda, since to do otherwise would be to insult the leading shareholders, the ones that pay the bills and choose the management. The United States position is clear enough. "We've already paid at the office, during the Cold War, so now leave us alone and let us enjoy our wealth and New Economy." Is this an unfair characterization? Cut beneath the high-minded rhetoric of a high-minded Administration, and see the grim reality. In 1998, the United States foreign assistance totaled around $8.8 billion, or 0.12 of one percent of the Gross National Product. And of this derisory sum, only around one-sixth went to the least developed countries. A sixth of twelve-hundredths of one-percent of GDP amounted to the grand total of around $4.95 per American in 1998 for the world's least developed countries.

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State Capitalism and the Operation of the Public Sector

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International Policy Coordination: The Case of the Developing Country Debt Crisis

This paper reviews the management of the debt crisis to date, and considers several possible alte... more This paper reviews the management of the debt crisis to date, and considers several possible alternative approaches for international cooperation in the future. The first part of the paper briefly reviews the scope of the crisis, and some of the reasons for its onset. Then, the paper describe the internationally coordinated policy responses to the crisis, as well as the conceptual underpinnings of this coordinated response. In the latter part of the paper, some of the reasons for the incomplete success of the policy response are described, and several alternative measures for the future are discussed. The discussion emphasizes the possible merits of debt forgiveness in addition to debt reschedulings as an instrument for the future management of the debt crisis.

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The External Debt Problem in Central America: Honduras, Nicaragua, and the HIPC Initiative

SSRN Electronic Journal, 1999

This paper reviews the foreign debt burden in Central America with special emphasis on Honduras a... more This paper reviews the foreign debt burden in Central America with special emphasis on Honduras and Nicaragua, which have a large debt overhang. Several indicators suggest that this foreign debt seriously impedes economic growth in both nations. Honduras and Nicaragua, the poorest countries of Central America, have lagged behind the rest of the region in growth, resulting in an increase in regional income inequality during the 1990s. Analysis suggests that Honduras and Nicaragua require alleviation of their foreign debt as a prerequisite to sustained growth. This paper also evaluates the prospects of these countries to qualify for the new initiative aimed at reducing the debt burden of the highly indebted poor countries (the so-called HIPC Initiative). It concludes that Honduras and Nicaragua have favorable prospects of qualifying for the HIPC Initiative. In general, both countries meet the eligibility criteria. Honduras and Nicaragua face a higher foreign debt burden than three countries that have already qualified for HIPC treatment. The main obstacle, however, is demonstrating successful macroeconomic performance under the supervision of the IMF. The paper ends with a discussion of the strategy that these countries should follow in order to achieve maximum debt relief.

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International payments imbalances of the East Asian developing economies

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Development

Location and climate have large effects on income levels and income growth through their effects ... more Location and climate have large effects on income levels and income growth through their effects on transport costs, disease burdens, and agricultural productivity, among other channels. Geog- raphy also seems to affect economic policy choices. Many geographic regions that have not been conducive to modern economic growth have high population densities and are experiencing rapid increases in population. At particular

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Fiscal Federalism and Optimum Currency Areas: Evidence for Europe From the United States

The main goal of this paper is to estimate to what extent the federal government of the United St... more The main goal of this paper is to estimate to what extent the federal government of the United States insures member states against regional income shocks. We find that a one dollar reduction in a region's per capita personal income triggers a decrease in federal taxes of about 34 cents and an increase in federal transfers of about 6 cents. Hence, the final reduction in disposable per capita income is on the order of 60 cents. That is, between one third and one half of the initial shock is absorbed by the federal government. The much larger reaction of taxes than transfers to these regional imbalances reflects the fact that the main mechanism at work is the federal income tax system which in turn means that the stabilization process is automatic rather than specifically designed each time there is a cyclical movement in income. Some economists may want to argue that this regional insurance scheme provided by the federal government is an important reason why the system of fixed exchange rates that exists within the United States today has survived without major problems. Under this view, the creation of a European Central Bank that issues unified european currency without the simultaneous introduction (or expansion) of a fiscal federalist system could put the project at risk. Rough calculations of the impact of the existing european tax system on regional income suggests that a one dollar shock to regional GDP will reduce tax payments to the EEC government by half a centL Hence, the current European tax system has a long way to go before it reaches the 34 cents of the U.S. Federal Government.

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Bolivia's Economic Crisis

By any standard, Bolivia's economic crisis in the 1980's has been extraordinary. Like its neighbo... more By any standard, Bolivia's economic crisis in the 1980's has been extraordinary. Like its neighbors. Bolivia suffered from major external shocks, but the extent of economic collapse in the face of these shocks (including a hyperinflation during 1984-85) suggests that internal factors as well as external shocks have been critical to Bolivia's poor economic performance. One major theme of our work is that the recent economic crisis in Bolivia is a reflection of political and economic conflicts in Bolivian society that have undermined the development process throughout this century. While major reforms have been begun by the present government, many of the deepest problems in Bolivian society that contributed to the crisis remain unresolved.

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The strategic significance of global inequality

The Washington Quarterly, 2001

as well as a research associate of the National Bureau of Economic Research. He is also Special A... more

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Sustainable Development

Science, 2004

The United Nations Millennium Development Goals (MDGs) set the stage for developing countries to ... more The United Nations Millennium Development Goals (MDGs) set the stage for developing countries to reduce extreme poverty and the problems that accompany it, such as hunger, high rates of infant, child and maternal mortality, insufficient disease control, lack of education, illiteracy, gender disparity and environmental degradation. Each goal has a specific target level for progress, such as halving poverty or reducing infant mortality rates by two thirds. All goals are to be reached by 2015, using 1990 as the benchmark year. By setting a time frame and specific levels of reductions for a variety of indicators, progress towards the goals is measurable, if data on indicators is available. Tracking progress is an essential step towards meeting the goals, as problem areas can be identified only through monitoring and evaluation, and interventions and strategies can then be developed to target them. South Asia as a whole seems likely to halve poverty levels by 2015, due in large part to India's progress on this MDG indicator. However, the situation is not as promising in other areas, such as reduction of high rates of infant, under-five and maternal mortality. There are wide inter-country, interstate and intra-state differences in levels of progress towards the goals throughout South Asia. In a country as large and as populous as India, tackling problems such as high maternal mortality rates at the state and even at the district levels could determine whether India as a whole achieves the MDGs. Over one billion of the roughly 1.37 billion residents of South Asia reside in India, which means that India's achievement of any of the goals brings South Asia as a whole a step closer towards regional goal attainment.

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Poverty trap formed by the ecology of infectious diseases

Proceedings of the Royal Society B: Biological Sciences, 2009

While most of the world has enjoyed exponential economic growth, more than one-sixth of the world... more While most of the world has enjoyed exponential economic growth, more than one-sixth of the world is today roughly as poor as their ancestors were many generations ago. Widely accepted general explanations for the persistence of such poverty have been elusive and are needed by the international development community. Building on a well-established model of human infectious diseases, we show how formally integrating simple economic and disease ecology models can naturally give rise to poverty traps, where initial economic and epidemiological conditions determine the long-term trajectory of the health and economic development of a society. This poverty trap may therefore be broken by improving health conditions of the population. More generally, we demonstrate that simple human ecological models can help explain broad patterns of modern economic organization.

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6 Political Independence and Economic Reform in Slovenia

RePEc: Research Papers in Economics, 1994

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