I trace the inequality to a particular set of decisions that we took when we lowered the tax rate from 91% down to very low levels at the top, where we stripped away regulations. So the result of that was not a more dynamic economy, but a more unequal society. We tried the experiment of trickle-down. A third of a century later, we can say fairly definitively that it was a failure.
Joseph StiglitzIn a globally integrated economy, the biggest challenge is to make sure there is adequate global aggregate demand, achieved through spending, when countries like China feel they must save high levels of dollar reserves to protect against international currency volatility.
Joseph StiglitzAmherst is a liberal arts college, committed to providing students with a broad education.
Joseph StiglitzChina's accumulation of reserves is a result of the IMF's mismanagement of the Asian financial crisis a decade or so ago. If countries know they can't rely on the IMF to help them, their best defense is their own reserve cushion. In a time of spreading global recession, too much emphasis on savings in surplus countries like China can impede prospects for global growth.
Joseph Stiglitz