Fiscal Policy in an Unemployment Crisis

6 July, 2016

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Rendahl, Pontus, “Fiscal Policy in an Unemployment Crisis”, The Review of Economic Studies, 22 February This article shows that equilibrium unemployment dynamics can significantly increase the efficacy of fiscal policy. In response to a shock that brings the economy into a liquidity trap, an expansion in government spending increases output and causes a fall in the unemployment rate. Since movements in unemployment are persistent, the effects of current spending prevail into the …Read More

Library » EU » Economy » Scientific Articles

A National Wealth Approach to Banking Crises and Financial Stability

6 July, 2016

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Frecaut, Olivier, (2016), “A National Wealth Approach to Banking Crises and Financial Stability”, IMF Publications, 5 July The paper explores a different, supplementary way to assess and manage a particular type of banking crises, those arising from a rise of nonperforming loans to the corporate sector. It relies on a “national wealth approach,” focusing on the distribution of net wealth among economic sectors and its interaction with developments in the banking …Read More

Library » EU » Economy » Reports

Understanding the Size of the Government Spending Multiplier: It’s in the Sign

6 July, 2016

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Barnichon, Régis, Matthes, Christian, (2016), “Understanding the Size of the Government Spending Multiplier: It’s in the Sign”, Centre for Economic Policy Research, July Despite intense scrutiny, estimates of the government spending multiplier remain highly uncertain, with values ranging from 0.5 to 2. While an increase in government spending is generally assumed to have the same (mirror-image) effect as a decrease in government spending, we show that relaxing this assumption is important …Read More

Library » EU » Economy » Opinion Articles

Brexit versus Grexit: Why you might call a referendum and then reject its outcome

6 July, 2016

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Pastor, Lubos, (2016), “Brexit versus Grexit: Why you might call a referendum and then reject its outcome”, Voxeu, 4 July Britain voted for Brexit, but many seek ways to avoid it. This draws comparison with the events of almost exactly a year ago when the Greek government ignored the outcome of the Greek bailout referendum. This column argues that the Greek government hoped the result would crash the EU’s stock markets …Read More

Library » EU » Economy » Opinion Articles

Credit spreads, economic activity and fragmentation

5 July, 2016

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De Santis, Roberto A., (2016), “Credit spreads, economic activity and fragmentation”, ECB, No 1930 / July 2016 Credit spreads may be jointly driven by developments that are orthogonal to the current state of the economy. We show that this unobserved systematic component is demanded to hedge against adverse economic áuctuations. Using either yield-to-maturity spreads or asset swap spreads for 2345 Eurobonds across euro area non-Önancial industries, we estimate a market-wide relative excess …Read More

Library » EU » Economy » Reports

The race between machines and humans: Implications for growth, factor shares and jobs

5 July, 2016

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Acemoglu, Daron, Restrepo, Pascual, (2016), “The race between machines and humans: Implications for growth, factor shares and jobs”, Voxeu, 5 July Many economists throughout history have been proven wrong in predicting that technological progress will cause irreversible damage to the labour market. This column shows that so far, the labour market has always adapted to the replacement of jobs with capital, using evidence of new types of skilled jobs between 1970 and …Read More

Library » EU » Economy » Opinion Articles

Brexit And The EU: A New Deal For All The EU Or No Deal At All?

4 July, 2016

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Schmidt, Vivien, (2016), “Brexit And The EU: A New Deal For All The EU Or No Deal At All?”, Social Europe, 1 July Now that the UK has voted to leave the EU, all the attention has been focused on how it will go about leaving, or even whether it will leave in the end. But equally important is how the EU responds to Brexit: whether as an isolated case to …Read More

Library » EU » Economy » Opinion Articles

How large is the output gap in the euro area

4 July, 2016

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Jarocinski, Marek, Lenza, Michele, (2016), “How large is the output gap in the euro area”, European Central Bank, 1 July The estimates of the output gap depend on the features of the models used to derive them. We discriminate among different estimates on the basis of their ability to forecast inflation. Our analysis suggests that output in the euro area was 6% lower than potential in 2014 and 2015, which is …Read More

Library » EU » Economy » Opinion Articles

Labour Mobility in the EU: Addressing challenges and ensuring ‘fair mobility’

4 July, 2016

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Barslund, Mikkel, Busse, Matthias, (2016), “Labour Mobility in the EU: Addressing challenges and ensuring ‘fair mobility’”, Centre for European Policy Studies, 1 July Labour mobility creates economic benefits for the EU at large and the mobile workforce. The same can be said for the special case of posted workers – a form of labour mobility that is crucial to the functioning of the internal market for services. Moreover, the number of posted …Read More

Library » EU » Economy » Reports

Have monetary data releases helped markets to predict the interest rate decisions of the European Central Bank?

4 July, 2016

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Jung, Alexander, (2016), “Have monetary data releases helped markets to predict the interest rate decisions of the European Central Bank?”, European Central Bank, No 1926 / July This paper examines whether monetary data releases by the European Central Bank (ECB) have provided markets with additional clues about the future course of its monetary policy. It conducts a novel econometric approach based on a combination of an Ordered Probit model explaining future policy …Read More

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