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The Need for a New Economic Model
Giorgio Arfaras, Economist, Centro Ricerca e Documentazione Luigi Einaudi
After World War II, a formal exchange rate system emerged between US, Europe, and Japan. Recently, an informal exchange system between the US and China has emerged, in which China sends goods and accumulates credit in order to maintain exchange rate parity. Now, the US model of growth through large household debt is under stress. Can today’s economic models and systems survive? What is the best solution for the future?
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