Economics
Tax cuts should focus on income from capital, French paper argues
Cutting taxation on labour is less effective in boosting growth, researchers say
US taxes low by global standards, say Chicago Fed economists
Overall burden of taxes is low by OECD standards, and taxes on capital income are notably lower than in Germany, economists say
Piecing together a financial theory of stagnation
Ideas presented at recent BIS annual meetings reveal an emerging framework that explains how the financial system may be dragging down the real economy; Hélène Rey was the latest to contribute
Eurozone’s demographics will continue to push interest rates down – paper
Structural policies will take time to reverse impact of adverse demographics, researchers say
Paper proposes method to estimate network of exposures
Researcher draws on aggregate exposures and market data to build a more complete picture of the network of bank exposures
Flexible working may shift Nairu, ECB’s Mersch warns
Technology may increase insecurity and weaken collective bargaining, says senior ECB figure
Singapore’s inflation sees sudden drop in June
Sharp fall in inflation was due to the falling prices of housing maintenance and repairs, triggered by the timing of government rebates
IMF gloom on US and UK balanced by brighter spots elsewhere
IMF raises projections for China, Japan and eurozone as the UK and US falter; maintains global growth forecasts at 3.5% in 2017
BoE economists issue ‘call to arms’ for macro-prudential research
Researchers outline a simple framework to help understand the macro-prudential “balancing act”, but say there is a long way to go in developing a definitive model
BoE paper warns escape from secular stagnation may ‘beggar thy self’
Authors outline an unappealing situation where the only escape comes from currency depreciation, but may nevertheless end up harming domestic welfare
Non-banks drive rebound in cross-border banking – BIS
First-quarter statistics show non-banks helped drive a turnaround of cross-border banking flows, which had been in retreat
Eurozone tax systems subsidise housing debt, ECB paper argues
Under-taxation of returns to home equity drives distortions, researchers say
BoE’s Broadbent: globalisation has been largely a good thing
Bank of England deputy says flexible labour market has helped dull the pain of adjustment to trade shocks, while lower prices have most benefited the poorest groups
Yellen warns of debt impact on productivity
Fed chair states in “strongest possible terms” that the current spending by the US government is unsustainable and could harm productivity
CEPR paper sketches ‘radical, realistic’ Greek reform plan
Stanford and Yale economists outline “unorthodox” policies that could put Greek debt on a sustainable footing – and might be acceptable to all negotiating parties
Big data sheds light on income risk – Minneapolis Fed research
Better sources of data have allowed economists to gain new insights into how income risk changes over the cycle, says researcher
Pass-through varies across countries and time – BoE paper
Kristin Forbes and co-authors study the shocks and structural factors that help explain variations in the exchange rate’s impact on inflation
Bank of Canada broadening intelligence gathering with new survey
Systemic risk survey will be launched next year, says deputy governor, emphasising market intelligence can never provide a “perfectly complete picture”
Household balance sheet adjustment a long process – Danish study
Research into patterns of consumption and saving before and after the 2008 crisis shows deleveraging can take a long time; consumption impact of rate hike is “modest”
New Keynesian DGSE models need financial spillover channels – ECB paper
Models without powerful financial spillover channels will be “misleading”- researchers
Pakistan growth hits decade high – SBP report
Central bank says high growth, low inflation and solid investment are nevertheless overshadowed by falling exports, which have impacted reserves