Economics
2016: The year in review
The past year was characterised by dramatic political events, and central banks did not always manage to stay above the fray; we look back at some of the biggest stories
Paper uses Swedish refugee data to assess financial literacy
Authors say the randomly determined placement of refugees in Sweden provides a handy natural experiment on how financial literacy can spread
BIS’s Caruana: fiscal space is ‘slippery’
Fiscal authorities should not overestimate the available room for manoeuvre, as less obvious factors may pose constraints, BIS chief says
BoE article sees benefits to agent-based modelling
“Bottom-up” approach is complementary to models that are already widely used; the Bank of England has created new models for both housing and corporate bond markets
IMF paper shows US monetary conditions impact EM leverage
Impact is more pronounced for firms that are dependent on external financing, authors find; sample shows financial conditions have the ability to influence borrowing constraints
Greek negotiations turn acrimonious amid debt relief freeze
ESM freezes debt relief measures for Greece, accusing government of breaking spending promises; European Commission’s Moscovici hits back at IMF criticism
Non-linear shocks create asymmetric policy impacts – paper
Bank of England working paper shows a shock to mortgage spreads has more of an impact on the real economy during periods of recession, with implications for policy
Netherlands paper exposes differing capital flows across EMU
Paper examines the mechanism behind divergence of north and south eurozone members, as capital flows caused external imbalances to move in opposite directions
Central banks working to overhaul data-sharing
IFC report finds many central banks are seeking ways to better share micro data, both internally and externally
IMF paper links Chinese growth to ‘drastic increase’ in inequality
Rapid growth in recent decades linked to rising economic inequality, with consumption and income inequality co-moving closely
Updated Bank of Mauritius survey questions people on inflation causes
Latest survey shows Mauritian stakeholders are wary of external factors; exchange rate was viewed as second most important factor under new question format
Economic growth on the horizon for Finland, says Liikanen
Improved productivity and higher employment are needed to boost economic growth, says Finnish governor; Bank of Finland’s forecasts show recovery will be slower than in previous cycles
IMF officials say they want less austerity for Greece, not more
Fund and European creditors still disagree on design of Greek programme, as IMF says fiscal targets must be realistic
Icelandic paper finds evidence of rising natural rate
Authors attempt the notoriously difficult process of estimating the natural rate, using various models; rate appears to be on the rise
BIS economists model benefits of leaning against the wind
Endogenous model of financial crises points to benefits of using monetary policy to lean against financial imbalances, in contrast to many other studies
BoE paper drops rational expectations to solve unemployment puzzles
Replacing rational expectations with adaptive learning helps fit the standard theory of unemployment to the data, economists find
IMF to tackle effects of globalisation in 2017
Fund says it will focus on bringing the benefits of globalisation and technology to a wider section of society, amid a populist backlash against openness
Researcher uses dynamic factor model for ‘nowcasting’
Research makes three additions to widely-used model
Changing policy impact may knock forecasts askew – Riksbank economists
Economists suggest systematic errors of forecasts in recent years may reflect changes in the effectiveness of monetary policy
Spanish paper looks at eurozone inflation expectations
Pan-eurozone factors are more important than country-specific forces, paper says
BoE unveils database of macro-prudential policies
Researchers attempt to classify the myriad forms of macro-prudential policy, compiling panel data on when policies were tightened and loosened in different countries
Finnish paper rethinks transmission of financial shocks
Researcher’s model uses search and matching approach
ECB publishes latest eurozone trade and investment guide
“Bop and IIP book“ explains compilation of national and eurozone figures
Eurozone must urgently raise productivity, Draghi warns
ECB policy provides governments with "window of opportunity" for reform, ECB president says