Economics
Summers Sees Risk U.S. and Europe Will End Up Mirroring Japan
- Interest rates to be very low for years, he says in paper
- Former U.S. Treasury Secretary backs bigger budget deficits
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The U.S. and Europe run the risk of replicating the experience of Japan and need to undertake forceful fiscal, monetary and structural policies, former Treasury Secretary Larry Summers said in a new research report.
Co-written with Bank of England Senior Economist Lukasz Rachel, the paper argues that interest rates in advanced nations are likely to remain “very low’’ for years to come due to aging populations, elevated income inequality and slow productivity growth.