Jakab, Ζ., Lukyantsau, Ρ. & Wang, S. (2015) “A Global Projection Model for Euro Area Large Economies“, IMF Publications, Working Paper No. 15/50   The GPM project is designed to improve the toolkit for studying both own-country and cross-country linkages. This paper creates a special version of GPM that includes the four largest Euro Area (EA) countries. The EA countries are more vulnerable to domestic and external demand shocks because …Read More

Justiniano, A., Primiceri, G. & Tambalotti, A. (2015) “Credit supply and the housing boom“, VoxEU Organisation, 27 February.   There is no consensus among economists on the forces that drove the historical rise of US house prices and household debt that preceded the Global Crisis. In this column, the authors argue that the fundamental factor behind that boom was an increase in the supply of mortgage credit. This rise was …Read More

Gechert, S., Hughes Hallett, A. & Rannenberg, A. (2015) “Fiscal multipliers in downturns and the effects of Eurozone consolidation“, Centre for Economic Policy Research, Policy Insight No. 79, 25 February.   The literature on fiscal multipliers has expanded greatly since the outbreak of the Global Crisis. This column introduces CEPR Policy Insight 79, which reports on a meta-regression analysis of fiscal multipliers collected from a broad set of empirical reduced form …Read More

Holter, H., Krueger, D. & Stepanchuk, S. (2015) “Tax progressivity and the government’s ability to collect additional tax revenue“, VoxEU Organisation, 20 February.   Since the Global Crisis, debt sustainability has received increasing attention. This column argues that the maximum sustainable debt level depends negatively on the progressivity of the tax system. The authors estimate that the US is still relatively far from the peak of its Laffer curve and …Read More

Vuillemey, G. (2015) “Do derivatives make the world safer?, VoxEU Organisation, 12 February.   The interest rate derivatives market has grown tenfold over the past 15 years. These contracts are mostly held by commercial banks, raising financial stability concerns. This column discusses how hedging using derivatives affects bank lending and the occurrence of bank defaults. The interest rate derivatives market is the largest market in the world, with an aggregate …Read More