VoxTalks Economics

Ukraine's cities were failing long before the Russian invasion began. Kyiv and Lviv ranked among the 40 most congested cities in the world, yet neither makes the top 100 by population. Ninety per cent of Ukraine's housing stock was built before 1990. Its urban infrastructure was designed for a Soviet economy and never properly adapted for the one that followed. So when reconstruction begins, the question is not simply how to repair what was there: it is whether repairing what was there is the right goal.
Edward Glaeser of Harvard, Martina Kirchberger of Trinity College Dublin, and Andrii Parkhomenko of the University of Southern California argue that the most instructive precedent is not post-USSR Warsaw, or postwar Berlin, it is postwar Tokyo. Firebombed into ruin, Tokyo rebuilt in a way that was strikingly decentralised: master plans quickly abandoned, local communities empowered to combine small lots through land readjustment, and figure it out from the bottom up. Before the war, Ukraine's economic activity was already shifting away from heavy industry and the east, towards services and the west. Reconstruction that concentrates investment where the damage is greatest, rather than where people want to build a new life, would repair the buildings and miss the point.
The research behind this episode:
Glaeser, Edward L., Martina Kirchberger, and Andrii Parkhomenko. 2025. "Rebuilding Ukraine's Cities: Maximizing Benefits and Minimizing Costs." Economic Policy: Papers on European and Global Issues, special issue: "What's Next for Ukraine?" 
To cite this episode:
Phillips, Tim. 2026, "What's Next for Ukraine: Reconstruction." Economic Policy: Papers on European and Global Issues (podcast). 

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About the guests

Edward Glaeser is Fred and Eleanor Glimp Professor of Economics at Harvard University and a Research Associate of the National Bureau of Economic Research. He is one of the world's leading urban economists, with a research agenda spanning cities, housing markets, economic growth, and governance.
Martina Kirchberger is a CEPR Research Affiliate and Assistant Professor in Economics at Trinity College Dublin. Her research focuses on structural transformation, urban economics, and development in low- and middle-income countries.
Andrii Parkhomenko is Assistant Professor of Real Estate at the USC Marshall School of Business and a researcher at the Kyiv School of Economics. His work centers on urban and spatial economics, with a particular focus on housing markets and city growth.
Research cited in this episode

Ukraine Rapid Damage and Needs Assessment, World Bank Group, European Commission, and UN, 2024. The source of the physical damage figure cited in this episode: approximately $175 billion by the end of 2024, with estimates for end-2025 likely exceeding $200 billion. Some independent projections cited by Glaeser run to $500 billion or above.
The concept of investing-in-investing, referenced by Kirchberger, originates in work by Paul Collier on how resource-rich developing countries can scale up capital investment effectively. It refers to the prior investments in institutions, skills, and capacity that must be made before large-scale capital flows can be productively absorbed. The implication for Ukraine: there is work to do now, before reconstruction begins at scale.
The Tokyo land readjustment model, which Glaeser cited as the most instructive reconstruction precedent, allowed owners of small fragmented lots to pool their land, redevelop it jointly, and receive a share of the new property in exchange for their stake in the old. It enabled large-scale urban reconstruction without central expropriation, and without waiting for government direction. The mechanism remains in active use in Japanese urban planning.
The Solidere reconstruction of central Beirut was raised as a cautionary counterexample: a centralised, top-down rebuild that produced a high-end commercial district with questionable benefit to ordinary Lebanese, and which substantially enriched its private shareholders. The contrast with Tokyo's decentralised model is the episode's sharpest illustration of what reconstruction can and cannot achieve when organised from above.
More in the "What's Next for Ukraine?" series

This episode is the second in a three-part series based on papers presented at the inaugural Economic Policy winter conference, Paris, December 2025.
Episode 1: Yuriy Gorodnichenko and Maurice Obstfeld on the investment and financing challenge: $40 billion a year, debt restructuring as a prerequisite for private capital, and why the number is more achievable than it sounds.
Episode 3: Demobilisation and the labour market: getting soldiers back into work without breaking the economy that kept the country going. 
Related reading on VoxEU

Rebuilding cities in Ukraine: A VoxEU column on the urban reconstruction challenge, including the spatial decisions that will shape how Ukraine's cities develop in the decades after the war.
A blueprint for the reconstruction of Ukraine: A comprehensive VoxEU overview of the reconstruction architecture: what institutions are needed, how international financing can be coordinated, and what the sequencing of investment should look like.
Completing Ukraine's reconstruction architecture: On the remaining gaps in the international framework for financing and coordinating Ukraine's rebuild, and what needs to happen before reconstruction can begin at the required scale.
Lessons for rebuilding Ukraine from economic recoveries after natural disasters: What the evidence from post-disaster reconstruction in other countries tells us about what works, what fails, and how quickly economies can return to their pre-shock trajectories.

Ukraine will emerge from this war with enormous debt. The conventional wisdom treats that as an obstacle: investors weigh it before committing capital, and the burden slows the recovery before it starts. Yuriy Gorodnichenko and Maurice Obstfeld of UC Berkeley argue the opposite. A thorough restructuring of Ukraine's war debts – including, for sufficiently large obligations, outright forgiveness – is not just politically defensible but economically essential for attracting private investment. 
The bill for rebuilding and growing Ukraine, Gorodnichenko estimates, is $40 billion a year: $20 billion to replace destroyed capital, $10 billion to stop Ukraine falling behind its Eastern European peers, and $10 billion to start closing the gap. Put that figure next to what Poland absorbed in FDI during its post-communist transition, or the €200 billion of Russian state assets currently immobilised in Euroclear, or the budgetary support Ukraine has been receiving since 2022 – and it looks achievable. The harder challenge, they argue, is not raising $40 billion. It is directing it: towards investment rather than consumption. Ukraine didn’t grow in the post-Soviet era at the rate that its neighbours achieved. EU accession momentum and secure borders can be a signal to investors that this time the trajectory will be different.
The research behind this episode:
Gorodnichenko, Yuriy, and Maurice Obstfeld. 2026. "You Only Live Twice: Financial Inflows and Growth in a Westward-Facing Ukraine." Economic Policy: Papers on European and Global Issues, special issue: "What's Next for Ukraine?"
To cite this episode:
Phillips, Tim. 2025. "You Only Live Twice: Financial Inflows and Growth in a Westward-Facing Ukraine." Economic Policy: Papers on European and Global Issues (podcast).
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About the guests

Yuriy Gorodnichenko is a CEPR Research Fellow and Professor of Economics at the University of California, Berkeley, where he leads CEPR's Ukraine Initiative. His research spans monetary policy, fiscal policy, and the macroeconomics of growth and business cycles.
Maurice Obstfeld is a CEPR Distinguished Fellow and Class of 1958 Professor of Economics at the University of California, Berkeley. He served as Chief Economist of the International Monetary Fund from 2015 to 2018, and as a member of the Council of Economic Advisers under President Obama from 2014 to 2015. He is also a Fellow of the Econometric Society and the American Academy of Arts and Sciences.
Research cited in this episode

The discussion of debt overhang draws on a body of work from the 1980s developing-country debt crises, notably the insight that for sufficiently indebted countries, debt reduction can increase the expected value of what creditors recover. Gorodnichenko and Obstfeld apply this framework directly to Ukraine's war debts, arguing that deep restructuring – supported by bilateral official creditors, many of whom are European – is a prerequisite for private investment to follow.
The €200 billion figure for immobilised Russian central bank assets held at Euroclear is the basis for Obstfeld's proposal of a reparations loan that would give Ukraine immediate access to large-scale resources, with repayment contingent on Russian reparations. This is discussed in more detail in the related reading below.
More in the "What's Next for Ukraine?" series

This episode is the first in a three-part series based on papers presented at the inaugural Economic Policy winter conference, Paris, December 2025. Episodes 2 and 3, on rebuilding and the labour market, are forthcoming.
Related reading on VoxEU

You only live twice: A growth strategy for Ukraine — Gorodnichenko and Obstfeld's own VoxEU column summarising the key arguments in this paper: why $40 billion a year is achievable, what the policy levers are, and why the window matters.
Euroclear and the geopolitics of immobilised Russian assets — The legal and financial context behind the €200 billion of Russian central bank assets frozen at Euroclear, and what it would take to use them for a reparations loan to Ukraine.
Using the returns of frozen Russian assets to finance the victory of Ukraine — A VoxEU proposal for channelling the interest income generated by frozen Russian assets to finance Ukraine's needs, without requiring the more politically contested step of confiscating the assets themselves.
Ukraine's recovery challenge — An earlier VoxEU overview of the reconstruction task: the scale of damage, the role of EU accession, and the two-phase approach to restoring growth.

Recorded live at the CEPR Annual Symposium. We seem to be talking about the behaviour of alpha males on social media a lot recently. But what happens when we put them in charge of a country? The work of Mario Carillo of Universitat Autònoma de Barcelona attempts to answer that question. He talks to Tim Phillips about when and why voters choose alpha males, and how they respond to being given power.

What type of manager would you be? An experiment in Ethiopia set out to measure the management traits of young professionals by setting them challenges in a video studio, and along the way also uncovered valuable (and surprising) information about the type of manager that employees and employers preferred.
Simon Quinn of Imperial College London and CEPR and Tom Schwantje of Bocconi University were two of the researchers. They tell Tim Phillips about why it is important to develop better managers, and how we might do that for young professionals.

Recorded live at the CEPR Annual Symposium in Paris. 
When VoxTalks Economics visits a symposium or conference, we try to find the most interesting new research from economists who are just starting out in their careers. In Paris we invited three of them to the CEPR Office to tell us about their work.
In this episode, Tim Phillips talks to Lucie Giorgi, Aix-Marseille School of Economics (AMSE), whose research tracks the impact of sex segregation in French elementary schools; Alishuba Philip of the University of Zurich, who has investigated why slum redevelopment often doesn’t benefit the people who live there, and Ali Bakhtawar – also of AMSE – about Lawfare in Pakistan.