Ilzkovitz, Fabienne, Dierx, Adriaan, (2016), “Competition policy and inclusive growth”, Voxeu, 19 June Firms with greater market power can behave monopolistically, and recent research suggests that declining market competitiveness is driving income inequality. While competition authorities already measure the overall impact of their interventions by using customer savings, these measurements do not account for indirect effects of intervention. This column introduces a DSGE model to model competition policy interventions as a negative …Read More

Eisenbach, Thomas, Lucca, David, Townsend, Robert, (2016), ” The economics of bank supervision: Theory and evidence “, Voxeu, 17 June 2016,  The two main elements of bank industry oversight are regulation and supervision. This column provides a framework for thinking about supervision in relation to regulation. Using US data on supervisory hours spent, it finds evidence of economies of scale for bank size. Additionally, less risky banks receive substantially lower amounts of supervisory hours. The findings …Read More

Mishra, Prachi, (2016), “Rules of the monetary game”, VoxEU, 16 June All monetary policies have external spillover effects. However, the domestic mandates of most central banks may not legally allow them to take spillovers into account, and may force them to undertake aggressive policies so long as they have some small positive domestic effect. This column looks at the rules of the game for responsible policy in such a context. It …Read More

Eichengreen, Barry, (2016), “Financial Scarcity Amid Plenty”, Project Syndicate, 14 June With interest rates at all-time lows and central banks buying everything that moves, the world is awash with credit. Yet, paradoxically, a dangerous shortage of international liquidity is putting the global economy at risk. “International liquidity” refers to high-quality assets accepted around the world for paying import bills and servicing foreign debts. These are the same assets that central banks use …Read More