I am a Lecturer in Economics at SOAS University of London. I am also a member of the SOAS Centre for Sustainable Finance and a Fellow at the Forum for Macroeconomics and Macroeconomic Policies (FMM). My principal research interests are in financial macroeconomics, climate change and finance, ecological macroeconomics, shadow banking, and inequality. My work has been published in various peer-reviewed journals, including the Cambridge Journal of Economics, Ecological Economics, the Journal of Financial Stability, Nature Climate Change, the Journal of Post Keynesian Economics and the Review of Political Economy. I have worked as Principal Investigator and Co-Investigator in projects funded by Rebuilding Macroeconomics/ESRC, INSPIRE/ClimateWorks Foundation and the Network for Social Change. I am a member of the Committee of the Post-Keynesian Economics Society (PKES) and a Council member of the European Association for Evolutionary Political Economy (EAEPE).
‘Institutional supercycles: an evolutionary macro-finance approach’, Rebuilding Macroeconomics, Working Paper No. 15, July 2020 (with D. Gabor and J. Michell)
We build upon the Minskyan concepts of ‘thwarting mechanisms’ and ‘supercycles’ to develop a framework for the analysis of the dynamic evolutionary interactions between macrofinancial, institutional and political processes. Thwarting mechanisms are institutional structures that aim to stabilise the macrofinancial system. The effectiveness of such structures changes over time, creating a secular cyclical pattern in capitalism: the supercycle. We develop a macrofinancial stability index and identify two supercycles in the post-war period, which we label the industrial and financial globalisation supercycle respectively. For each, we apply a four-phase classification system, based on the effectiveness of institutions, customs and political structures for stabilising the macrofinancial system. The supercycles framework can be used to explain and anticipate macroeconomic, financial and thus political developments, and moves beyond conventional approaches in which such developments are treated as exogenous shocks.
‘Fiscal policy and ecological sustainability: a post-Keynesian perspective’ PKES Working Paper 1912, 2019 (with M. Nikolaidi)
Fiscal policy has a strong role to play in the transition to an ecologically sustainable economy. This paper critically discusses the way that green fiscal policy has been analysed in both conventional and post-Keynesian approaches. It then uses a recently developed post-Keynesian ecological macroeconomic model in order to provide a comparative evaluation of three different types of green fiscal policy: carbon taxes, green subsidies and green public investment. We show that (i) carbon taxes reduce global warming but increase financial risks due to their adverse effects on the profitability of firms and credit availability; (ii) green subsidies and green public investment improve ecological efficiency, but their positive environmental impact is partially offset by their macroeconomic rebound effects; and (iii) a green fiscal policy mix derives better outcomes than isolated policies. Directions for future heterodox macroeconomic research on the links between fiscal policy and ecological sustainability are suggested.
Climate change, financial stability and monetary policy, Ecological Economics, 2018, 152, pp. 219-234 (with M. Nikolaidi and G. Galanis)
Using a stock-flow-fund ecological macroeconomic model, we analyse (i) the effects of climate change on financial stability and (ii) the financial and global warming implications of a green quantitative easing (QE) programme. Emphasis is placed on the impact of climate change damages on the price of financial assets and the financial position of firms and banks. The model is estimated and calibrated using global data and simulations are conducted for the period 2016–2120. Four key results arise. First, by destroying the capital of firms and reducing their profitability, climate change is likely to gradually deteriorate the liquidity of firms, leading to a higher rate of default that could harm both the financial and the non-financial corporate sector. Second, climate change damages can lead to a portfolio reallocation that can cause a gradual decline in the price of corporate bonds. Third, climate-induced financial instability might adversely affect credit expansion, exacerbating the negative impact of climate change on economic activity. Fourth, the implementation of a green corporate QE programme can reduce climate-induced financial instability and restrict global warming. The effectiveness of this programme depends positively on the responsiveness of green investment to changes in bond yields.
Climate change challenges for central banks and financial regulators, Nature Climate Change, 2018, 8 (6), pp. 462-468 (with E. Campiglio, P. Monnin, J. Ryan-Collins, G. Schotten and M. Tanaka)
The academic and policy debate regarding the role of central banks and financial regulators in addressing climate-related financial risks has rapidly expanded in recent years. This Perspective presents the key controversies and discusses potential research and policy avenues for the future. Developing a comprehensive analytical framework to assess the potential impact of climate change and the low-carbon transition on financial stability seems to be the first crucial challenge. These enhanced risk measures could then be incorporated in setting financial regulations and implementing the policies of central banks.
Debt cycles, instability and fiscal rules: a Godley-Minsky synthesis, Cambridge Journal of Economics, 2018, 42 (5), pp. 1277-1313
Wynne Godley and Hyman Minsky were two macroeconomists who ‘saw the crisis coming’. This paper develops a simple macrodynamic model that synthesises some key perspectives of their analytical frameworks. The model incorporates Godley’s financial balances approach and postulates that private sector’s propensity to spend is driven by a stock-flow norm (the target net private debt-to-income ratio) that changes endogenously via a Minsky mechanism. It also includes two fiscal rules: a Maastricht-type fiscal rule, according to which the fiscal authorities adjust the government expenditures based on a target net government debt ratio; and a Godley–Minsky fiscal rule, which links government expenditures with private indebtedness following a counter-cyclical logic. The analysis shows that (i) the interaction between the propensity to spend and net private indebtedness can generate cycles and instability; (ii) instability is more likely when the propensity to spend responds strongly to deviations from the stock-flow norm and when the expectations that determine the stock-flow norm are highly sensitive to the economic cycle; (iii) the Maastricht-type fiscal rule is destabilising while the Godley–Minsky fiscal rule is stabilising; and (iv) the paradox of debt can apply both to the private sector and the government sector.