Foundations of Economic Prosperity Update | September 2025

This summer, the Hoover Program on the Foundations of Economic Prosperity rolled out new research and events tackling global policy challenges. From US engagement abroad to frameworks for shared prosperity, our work is moving research and policy forward. We kicked off the year with a flagship conference co-organized with the European Central Bank on "The Next Financial Crisis."

Hoover's Financial Regulation Working Group and the European Central Bank Team Up to Pinpoint Threats to Global Financial Stability

In a landmark collaboration, a joint conference tackled one of the most pressing questions facing the global economy: What could trigger the next financial crisis?

Scholars from across the US and European Union participated in the Tenth Annual ECB Research Conference, organized jointly with the Hoover Institution. Photo credit: Andrej Hanzekovic/ECB

The conference featured opening remarks from European Central Bank (ECB) President Christine Lagarde, a keynote by Hoover Senior Fellow Raghuram Rajan, and remarks by Hoover Senior Fellows Ross Levine and Amit Seru, who codirect Hoover's Financial Regulation Working Group and co-organized the conference.

European Central Bank President Christine Lagarde delivers opening remarks. Photo credit: Adrian Petty/ECB

"By co-organizing with the European Central Bank-one of the world's three most influential central banks-we created a rare forum linking academic research with policy at the highest level. Leading Hoover scholars ensured that the latest ideas on financial stability were debated directly with those charged with safeguarding the global system," said Ross Levine.

View the session recordings here.

Can the Market Trust Stablecoins?

In a Wall Street Journal op-ed, Hoover Senior Fellow Amit Seru argues that while the GENIUS Act marks a significant step in integrating stablecoins into the US financial system, the regulation comes with trade-offs. By restricting permissible backing assets-primarily cash deposits and short-term US Treasuries-the act channels risk into a concentrated corner of the market that has yet to be tested at scale. The irony, Seru notes, is that stablecoins were originally celebrated for enabling transparent, decentralized transactions on the blockchain. Federal supervision pulls them back toward traditional finance, even as the systemic risks of widespread stablecoin adoption remain uncertain.

Read the op-ed here. [Subscription required]

CEOs Increasingly Using Informal Networks of Advisors, Professional Coaches

Half of all CEOs employ a professional coach to help them hone their leadership skills, and more than 80 percent maintain a "kitchen cabinet" of informal advisors to help them make decisions.

This is according to a new survey undertaken by scholars from the Hoover Institution's Governance of Organizations Working Group, the Stanford Graduate School of Business, Arthur and Toni Rembe Rock Center for Corporate Governance, and The Miles Group.

"The mainstream adoption of coaching reflects how the role of CEO has evolved from being the ultimate authority in an organization to a leader who leverages external insights to drive better outcomes," said report coauthor Hoover Senior Fellow Amit Seru.

Read the report here.

The Promises and Challenges of Decentralized Governance

The Governance of Organizations Working Group will convene a conference on November 6, 2025, to examine decentralized governance-its promise of broader, more transparent information sharing, its risks of capture by small groups, and the conditions under which it helps or hinders organizations. Organized by Hoover Senior Fellows Stephen Haber, Amit Seru, Andrew B. Hall, and Paola Sapienza, the conference will focus on two settings where centralized and decentralized systems coexist: universities and blockchain-based crypto protocols.

Learn more about the conference here.

Global Banking Rules Are Failing Emerging Markets

In Project Syndicate, Hoover Senior Fellow Peter Blair Henry, Hoover Distinguished Visiting Fellow Jendayi Frazer, and Vera Songwe argue that the Basel III framework has unintentionally discouraged investment in emerging and developing economies (EMDEs). Stricter capital requirements make it far more costly for banks to finance infrastructure in these markets, exacerbating a massive funding shortfall. The authors call for targeted reforms to remove these barriers and help close the $3 trillion global infrastructure gap in EMDEs.

Read the op-ed here.

More Trade, Less Aid: Rethinking US-Africa Relations

In a new video, Hoover Distinguished Visiting Fellow Jendayi Frazer calls for deeper US engagement with Africa as a path to mutual security and prosperity. With its fast-growing population, Africa offers expanding markets, a vital labor force, and natural resources critical for semiconductors, aerospace, and green energy. Frazer warns that while China and Russia are already capitalizing on these advantages, the United States risks falling behind if it continues to treat Africa primarily as an aid recipient rather than a strategic partner.

Watch the video here.

There's a Reason India and the US Aren't Better Friends

In The Washington Post, Hoover Senior Fellow Amit Seru responds to the Trump administration's plan to raise tariffs on Indian imports, urging deeper US-India ties instead. As the world's two largest democracies and first- and fifth-largest economies, he argues they stand to gain far more from partnership than from pressure tactics. Long-term prosperity, Seru writes, will come from trust and respect-not short-run coercion.

Read the op-ed here. [Subscription required]

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