Economics
Ugandan governor rejects president’s growth target
Emmanuel Tumusiime-Mutebile says it is impossible for Uganda to become a middle-income country by 2017, as it will take two decades for the country to double its GNI per capita
Time series of financial market prices appear to exhibit fractal properties
BoE research paper suggests market price dynamic may be caused by the interactions of agents with different investment horizons and differing interpretations of information
Capital flows are 'fickle' and always have been, paper finds
Capital flow volatility is a fact of life for all economies at all points in time, say IMF researchers, who point out that bigger advanced economies are best placed to deal with ebb and flow
Terms of trade volatility exacerbates shock effects for small open economies
Research conducted at the Reserve Bank of Australia says big fluctuations in terms of trade compound the effects of a terms of trade shock in small, open economies
Unemployment strongest predictor of mortgage default in the US
Atlanta Fed research finds that individual unemployment increases the probability of mortgage default by 5 to 13 percentage points compared with average sample
Swelling profits explain rebound in risk appetite, San Fran Fed paper suggests
Research indicates corporate profit growth explains 40% of the decline in the spread between risky and risk-free bonds, according to economic letter by research vice-president
Break-even value of PMI is not 50 but 44, RBI working paper suggests
Wholesale Price Index inflation turns positive when PMI exceed 44, according to research; paper also finds that PMI predict the movements of final WPI
Employment losses have repaired corporate balance sheets, paper argues
Differences in post-crisis employment among EU members are largely driven by need in many countries to adjust balance sheets, according to IMF working paper
Eastern Caribbean Central Bank (ECCB) governor looking for ‘quantum leap’ in output
Dwight Venner calls for three-pronged approach to recoup the Eastern Caribbean Currency Union’s output losses over the past four years and return to growth
Sector-specific variables more relevant than thought in determining default risk
The effect and magnitude of risk drivers across sectors is highly heterogeneous, which should be taken into account when designing stress-testing analytical tools, research paper argues
Croatia among EU members whose spreads are most affected by fundamentals
While spillovers from external shocks remain the dominant factor in spreads EU-wide, Croatia is among those where fundamentals are playing an increasingly influential role
Bundesbank paper says EU convergence is a myth
Researchers identify a split between old and new, western and eastern member states; incomes are converging between smaller groups of countries rather than the EU collective
Philadelphia paper models export dynamics after large devaluations
Working paper says that exports responds ‘sluggishly’ to a large currency depreciation; creates a model to capture these dynamics and explore their macroeconomic impacts
Form of fractional reserve banking guarantees solvency for member banks
Research paper claims joint-liability bank coalition is a welfare-improving mechanism that allows members of society to achieve better allocation of resources, making it a ‘truly superior form of banking'
SNB researchers find modified Arima model predicts inflation better
Estimating Arima models for individual CPI expenditure items and aggregating the forecasts from these models gives better results than directly applying the Arima method to the total CPI, paper finds
Monetary union leads to too much fiscal discipline, research paper finds
Paul de Grauwe and Yuemei Ji argue that sovereignty lost with the creation of the eurozone prompted dramatic effects that were largely overlooked by the currency area's designers
Laffer curve changes shape when government debt varies
The Laffer curve changes depending whether transfers or government debt are varied to balance the government budget constraint, Banque de France paper shows; curve looks like horizontal 'S' when debt varies
Low correlation between relative consumption and price not due to market inefficiency
Central Bank of Luxembourg paper attempts to explain why the correlation between real exchange rates and relative consumption is either low or negative
South African market inefficiencies keep ‘insiders happy and outsiders out'
Sarb deputy governor Francois Groepe says speedy implementation of key proposals in the National Development Plan would be a good start for spurring more inclusive growth
German paper proposes new method for identifying time-invariant regressors
Discussion paper says existing techniques used to identify time-invariant regressors in dynamic panel data models are ‘quite biased’ and proposes a two-stage alternative
Currency appreciation not just bad news for exporters
The use of cheaper imported intermediates compensates for 0.2 percentage points of a 1% currency appreciation followed by proportionate drop in export sales, Czech National Bank study shows
Bundesbank paper confirms O-ring theory effect for FDI
Paper written by two economists at the University of Munich finds that the position of a country's industry on the value chain is just as important in determining FDI as is the country's productivity
Incomplete information can lessen the effect of shocks, paper finds
Australian research finds economic agents unable to tell how permanent a term of trade shock will be, but incomplete information means their reaction to shocks is more cautious
CEE business cycles still out of sync with eurozone, Polish paper finds
Despite some convergence, differences remain - particularly when it comes to agents' intra- and inter-temporal choices, which account for a large proportion of output fluctuation in the CEE region