Economics
Inside the ECB’s upgraded multi-country model
ECB-Base sets the blueprint for a new semi-structural workhorse model of the eurozone
Fiscal stabilisation spurs growth in low fixed-asset sectors - IMF
Those with difficulty raising external funds benefit most from policy, paper argues
Kansas City Fed explores sources of wage dispersion in the US
Paper explores relative importance of “lifetime differences” and “match-specific” factors
Public spending shocks work better when households are confident- paper
Government spending stimulus reduces household confidence as it confirms pessimism regarding the economy, paper argues
IMF working paper sees regulation as key driver of decline in foreign lending
Research contends regulatory tightening is behind much of the ‘sluggishness’ in international banking since the crisis; exploits survey data compiled in preparation for GFSR
Inflation and unemployment affect wage rigidity, Icelandic authors find
Research challenges New Keynesian assumption that timings of wage changes are exogenous, showing level of inflation and unemployment also matter
Slovenia report simulates effects of structural reforms
Report by local institute, in co-operation with the central bank and OECD, argues the time is “ripe” for structural reform in Slovenia; suggests long-term benefits outweigh short-term costs
IMF paper examines effect of ‘winning the oil lottery’
Research into the impact of oil discovery in certain municipalities in Brazil shows GDP per capita and urbanisation on the rise
Paper uses machine learning to nowcast GDP in Lebanon
Working paper published by IMF explores use of machine learning technique in assessing economic conditions in Lebanon, where analysis is a ‘distinct challenge’ on account of data lags
Charlie Bean calls for ‘culture changes’ at ONS in final statistics report
ONS should set up two centres to better measure economic activity, Bean says; using these centres will allow the ONS to fully ‘capture’ the digital economy
RBA’s Lowe says productivity still a problem
Australia has proven resilient through an uncomfortable rebalancing phase, but the economy is still plagued by disappointing productivity growth, deputy governor says
Book notes: The end of alchemy, by Mervyn King
King’s book on how to fix everything that is wrong with the financial and economic system lays out radical proposals that deserve serious consideration
IMF to publish informal briefings on Argentina
Staff compile informal briefings on countries when they fail to complete Article IV consultations; IMF will grant request from Argentina to publish those produced 2013-2015
Money matters: need for a monetary aggregate revival?
Evidence from the years of the Great Recession justify renewed attention to a broadly defined concept of the quantity of money in central bank research
Is China really the cause of sluggish global growth?
China's policy-makers blame structural problem in the West for global malaise, despite unprecedented monetary stimulus by central banks
Financial variables improve output gap estimates, BoE paper finds
Adding financial variables to estimates of the output gap can allow policy-makers to spot trouble on the horizon more easily, authors say
Book notes: Phishing for phools, by George Akerlof and Robert Shiller
The veteran economists’ study of the traps markets create for unwitting consumers ultimately ends up doing exactly what the authors caution against
BoE’s Cunliffe wants more detailed timetable for European reforms
Bank of England deputy governor welcomes ambition and honesty of five president report, published in June; hopes to see more detail on dates in future
Research considers impact of fiscal consolidation on debt-to-GDP ratio
Working paper published by ECB finds fiscal consolidation conducted through a revenue increase, rather than a spending cut, is ‘self-defeating austerity’
Research considers why macroeconomic announcements impact asset prices
A working paper published by the ECB weighs the ‘intrinsic value’ of macroeconomic news announcements in the US, finding timing is crucial to maintaining it
Caruana marks out dangerous nexus between debt, oil and the US dollar
BIS chief points to interactions of dollar borrowing by emerging markets, US rate hikes and the oil price, as latest data suggests world may be balanced on the edge of a drop in global liquidity