Debora Revoltella, Philipp-Bastian Brutscher and Patricia Wruuck, (2019), “An EU tax credit to preserve incentives for investment in human capital in the context of intra-EU migration”, VoxEU, 5 April Spending on education underpins the formation of human capital. But intra-EU labour mobility means that returns to such spending often accrue somewhere other than where the investment takes place, which can lead to sub-optimal levels of investment in countries that are …Read More

Carolynn Look and Catarina Saraiva, (2019), “ECB Seen Paying Banks to Make Loans Amid Bleak Economic Outlook”, 5 April The European Central Bank will pay banks to lend as it tries to find ways to support economic growth that looks increasingly shaky, according to a survey. The cost of new long-term funding for banks which raise credit growth above a certain level will be lower than the main refinancing rate, …Read More

Ellen Ryan and Karl Whelan, (2019), “Quantitative easing and the ‘hot potato’ effect: Evidence from euro area banks”, VoxEU, 5 April The EU’s asset purchase programme saw its central banks’ reserve balances increase to unprecedent levels. This column analyses the response of banks in the euro area to this expansion in system-wide reserves, in particular whether they absorbed the excess liquidity or tried to push it off their balance sheets. …Read More

Ines Goncalves Raposo, (2019), ” Secular stagnation and the future of economic stabilisation”, Bruegel, 1 April Larry Summers’ and Łukasz Rachel’s most recent study documents a secular fall in neutral real rates in advanced economies. According to the authors, this fall would be even more marked in the absence of offsetting fiscal policies. Policymaking in a world of permanently low interest rates may be hard to navigate, especially in troubled …Read More

Shekhar Aiyar and Christian Ebeke, (2019), “The missing link between income inequality and economic growth: Inequality of opportunity”, VoxEU, 3 April There are contrasting theories on the relationship between income inequality and growth, and the empirical evidence is similarly mixed. This column highlights the neglected role of equality of opportunity in mediating this relationship. Using the World Bank’s new Global Database on Intergenerational Mobility, it shows that in societies where …Read More

Maria Demertzis, André Sapir and Guntram Wolf, (2019), “Promoting sustainable and inclusive growth and convergence in the European Union”, Bruegel Policy Contribution Issue No 7, April The European Union can look ahead at the next five years from a good economic position. Employment is comparatively high, the recovery has been uninterrupted for several years and income inequality remains less pronounced than elsewhere in the world. But the EU faces nevertheless …Read More

Jean Pisani-Ferry, (2019), “Europe and the New Imperialism”, Project Syndicate, 1 April For decades, Europe has served as a steward of the post-war liberal order, ensuring that economic rules are enforced and that national ambitions are subordinated to shared goals within multilateral bodies. But with the United States and China increasingly mixing economics with nationalist foreign-policy agendas, Europe will have to adapt. Relevant Posts Christine Lagarde, (2019), «The Euro Area: …Read More

Christine Lagarde, (2019), “A Delicate Moment for the Global Economy: Three Priority Areas for Action”, IMF, 2 April In January, the IMF projected global growth for 2019 and 2020 at around 3 ½ percent—less than in the recent past, but still reasonable. It has since lost further momentum, as you will see from our updated forecast next week. Only two years ago, 75 percent of the global economy experienced an …Read More