Global Imbalances and Power Imbalances

Q: What does this research mean for the field?

Global financial imbalances, such as the creditor-debtor relationship between China and the United States, have the potential to generate geopolitical power imbalances through specific theoretical channels. Novelty: ClaimNovelty.METHODOLOGICAL. Consensus alignment: ConsensusAlignment.ESTABLISHES_NEW_DIRECTION.

Christopher Clayton; Matteo Maggiori; Jesse Schreger

doi:10.1257/pandp.20261017

May 1, 2026AEA Papers and Proceedings

Global Imbalances and Power Imbalances

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Key Points

The study examines how global economic disparities can lead to shifts in power dynamics between nations.
Discussed theoretical channels affecting power imbalances
Highlighted empirical measures for future literature to explore
Identified China as a major debtor and the U.S. as a significant creditor, implying a potential power shift
Suggested areas for further research to understand the implications of these imbalances

Implication

Explores the connection between global and power imbalances, highlighting theoretical and empirical avenues for future analysis.

Abstract

We discuss the conditions under which global imbalances, such as China being a large foreign creditor and the United States being a large foreign debtor, might also generate power imbalances. We highlight possible theoretical channels and empirical measures that the future literature could investigate in a full treatment of this topic.

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Cite This Study

Clayton et al. (2026) studied this question.

synapsesocial.com/papers/6a080ae2a487c87a6a40cdaa https://doi.org/10.1257/pandp.20261017

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Global Imbalances and Power Imbalances

Key Points

Implication

Abstract

Discussion

Cite This Study

Global Imbalances and Power Imbalances

Key Points

Implication

Abstract

Discussion

Cite This Study

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