Do We Need a Global ‘Central Planner’ and ‘Optimal’ Economic Policy for All?

Abstract

Recently we see a growing interest to and debates on the role of international associations like G20 or BRICS in the global economic renewal and global economic governance. Along with this there is a lot of issues related to establishing new international financial institutions like the New Development Bank or the Asian Infrastructure Investment Bank. However, in our view, all these discussions are based on the experience of the preceding economic crises and false theoretical backgrounds. In the paper we consider the necessity of current processes as a natural response to a new systemic crisis and the probable secular stagnation in the global economy. We argue that because the situation is completely new for both academic economists and policy makers the appropriate response to the global economic challenges is to give more competition and independence to international institutions and national policies. Correspondingly, the role and tasks of G20, or BRICS, as well as role of the World Bank, the IMF, or the WTO should change. We see all those organizations rather as venues for presenting and discussion of domestically oriented national policies and cooperation of international financial organizations than ‘central planners’ aiming at elaborating jointly agreed policy favorable for all member countries.

Keywords: Russian economy, systemic crisis, secular stagnation, BRICS, G20

JEL Classification: H12