International media cite GSE faculty research on spending cuts, anarchy, game theory, and mediation

As policymakers around the world continue to announce controversial budget cuts and austerity measures, news analysts from top international media outlets such as The Economist, Die Welt and the Wall Street Journal are turning to academic research to make sense of the subsequent social unrest and political fallout. Among the experts cited are Prof. Joachim Voth (ICREA-UPF and GSE) and Prof. Clara Ponsatí (IAE and GSE).

Austerity and Anarchy: Budget Cuts and Social Unrest in Europe, 1919-2009

Prof. Voth and co-author Prof. Jacopo Ponticelli (UPF) have received multiple citations in the press for this CEPR working paper, in which they find a causal link between government spending cuts and civil unrest.

"Once you cut expenditure by more than 2% of GDP, instability increases rapidly in all dimensions, and especially in terms of riots and demonstrations," they find in their research.

The two researchers began working on the paper following the Greek protests in 2010. Its release coincided with the violence in London, spawned by policy decisions to cut public spending, making it a timely read and a useful resource for news commentary on the summer's events.

Press coverage highlights:

VOXEU summaryBBC-Radio 4, Time Magazine, CNN, Wall Street Journal, El País, FAZ, Freakonomics, The Guardian, Expansión, The AtlanticEl Economista, France24, Frankfurter Rundschau, Berliner Zeitung, CTV-Canada, Die Welt

In addition to his research activities, Prof. Voth is the former director of the Barcelona GSE's Master Program in International Trade, Finance and Development, and he continues to teach in that program and to serve on its steering committee. He also teaches in the UPF's Graduate Program in Economics, Finance, and Management (GPEFM), a reference doctoral program of the GSE.

Using game theory software to mediate human conflicts

While Prof. Voth's paper looks at the causes of social strife, Prof. Ponsatí explores applications of game theory to try to resolve conflict through computer-assisted negotiation. Her work was recently cited in The Economist in a piece called "Modelling behaviour: Game theory in practice."

According to Prof. Ponsatí, in complex negotiations such as the Israeli-Palestinian conflict, a "mediation machine" might serve as a neutral negotiator if no human negotiator can be found—or trusted. The article includes a summary of Prof. Ponsatí's idea for how this could be achieved in practice:

"Negotiating parties would give the software confidential information on their bargaining positions after each round of talks. Once positions on both sides were no longer mutually exclusive, the software would split the difference and propose an agreement...Such “mediation machines” could lubricate negotiations by unlocking information that would otherwise be withheld from an opponent or human mediator."

The Economist, 03.09.2011

Prof. Ponsatí has published articles on the topic of mediation in a number of journals, including the Journal of the European Economic Association (2008) and the Journal of Mathematical Economics (2003). In addition to her research activities, she teaches in the UAB's International Doctorate in Economic Analysis (IDEA), one of the Barcelona GSE's reference doctoral programs, and directs the Institute for Economic Analysis (IAE), one of its academic bodies.

Joachim Voth

Joachim Voth (ICREA-UPF and GSE) discussing the future of the euro on Germany's ARD television network.

BBC Radio [14.08.11]

ARD Television [06.09.11] [de]

Clara Ponsatí

Clara Ponsatí (IAE and GSE) considers how game theory software could resolve human conflicts. Above:chairing a conference in Barcelona on macroeconomic perspectives of the crisis.

The Economist [03.09.11]


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