Research
BoE paper tests optimal policy when workers lose skills
Working paper asks how optimal monetary policy is affected by ‘human capital depreciation’; finds strict inflation targeting can be improved upon
IMF paper sees EU inflation expectations holding firm
Working paper says low core inflation in eurozone has had ‘significant’ impact on the rest of the region, though the main driver of disinflation remains food and energy prices
Bank of Finland paper examines impact of Basel II on international bank lending
Research finds sovereign credit rating revisions have become more important since the implementation of Basel II capital rules
Dollar and renminbi can coexist as global currencies, Eichengreen says
Bank of Korea paper finds that ‘networks are open and several international currencies can coexist’, suggesting the dollar and the renminbi will share the role in the future
Trade balance improves after fiscal devaluation, study finds
European economists analyse the effects of a temporary fiscal devaluation in Spain and Portugal, finding it leads to improved trade balance
IMF paper examines causes of financial market spillovers
Research finds financial market spillovers are affected by ‘bilateral portfolio asset holdings, as well as a country’s geographical preferences’
Fed paper models impact of return to normal rates
Discussion paper studies the likely effect of returning interest rates to more normal levels; finds different combinations of tools would have different effects on financial intermediation
French paper examines impact of ECB policy changes on asset prices
Working paper considers how ‘policy shocks’ affected short-term interest rates, as well as the expected future path of short-term interest rates, between 2002 and 2013
Riksbank economist warns on corporate bond market
Economist at the Swedish central bank says it will become ‘increasingly important’ to consider the impact of the corporate bond market on financial stability as it expands
Colombian paper analyses financial networks
Working paper finds central financial institutions ‘tend to overlap across financial networks, thus their systemic importance may be even greater than envisaged’ in alternate models
Belgian review: Common debt will remain ‘taboo’ in Europe
Article published in National Bank of Belgium economic review describes the issuance of common debt as a ‘panacea’ for multiple problems in the eurozone
RBI paper: Rural wages main driver of Indian food inflation
Research published by the Reserve Bank of India says it ‘bears to reason’ there is a need to raise agricultural productivity to mitigate food price pressures
Spanish economists adapt model on business cycle conditions to forecast growth
Working paper published by the Bank of Spain extends an existing model on US business cycle conditions to forecast GDP growth in real time
BIS paper proposes defence against market panics
Proposal would see governments link level of borrowing to interest rates, breaking the vicious cycle of rising rates leading to increased default risk
BIS paper tackles redistributive effects of regulation
Working paper studies how regulation tips welfare in favour of the real economy or financial sector, and suggests how regulators might deliver a Pareto improvement
BoJ paper details approach to macro stress testing
Tests feature model of feedback loop between economic and financial sectors, in attempt to gauge the ways in which shocks may reverberate through the economy
Banks should offer ‘equal service’ when facing a run, research finds
Working paper published by the Bank of Portugal analyses models of bank runs, and finds equal service leads to a faster recovery
Polish paper explores market perception of sovereign credit risk
Working paper finds macroeconomic and institutional developments were 'weakly correlated’ with market perception of sovereign credit risk in eurozone during crisis
BIS paper investigates factors behind birth and death of benchmarks
Working paper studies ‘benchmark tipping’, finding that although many government rates are being displaced by private benchmarks, China and Brazil may develop new government bond futures markets
Polish paper examines impact of foreign currency loans
Foreign currency loans restrict the transmission of monetary policy to the real economy but do not have a 'significant' impact on efficacy of macro-prudential measures, paper finds
European economists analyse global value chains
Bank of Portugal working paper analyses the global value chains in the eurozone and underlines the core role of Germany in production linkages
BoJ paper studies factors holding workers back from switching industries
Researchers find that differences in required tasks aggravate earnings gaps and encourage workers not to move, creating frictions in the Japanese labour market
Paper finds evidence of multiplier effect in food trade policy
IMF working paper studies the relationship between trade policy and food prices and finds evidence of a multiplier effect in its data sample
Portuguese research examines decline in allocative efficiency
Bank of Portugal working paper finds service sector the ‘main driver’ of decline in allocative efficiency between 1996 and 2011, which the authors say nearly halved GDP growth