Research
An improved model for predicting direct investment equity income
Paper from the Danish central bank finds that combining past profitability and change in expected consumption growth provides a better forecast
Risks influencing loan rates: Bank of England paper
Bank’s external monetary policy unit research shows loan size is not the only variable affecting rates, says higher income individuals are treated better by lenders
BIS on the origins of macroprudential
Bank for International Settlements research traces the etymology of macroprudential, noting that it has become a buzzword in the aftermath of the crisis
Discretionary policy with Calvo pricing: Kansas Fed paper
Kansas Fed research shows that sticky price models, such as the Taylor and Calvo variants, are not identical, and can have important policy implications
The simulation of inflation forecasting
IMF research asks how useful is a simple Phillips Curve in simulating inflation forecasting in real time in Germany, the UK, and the US?
Real-time output gap estimates unreliable: ECB paper
European Central Bank paper finds that real-time estimations of the difference between actual and potential GDP cannot be trusted in several respects
Real-time activity index shows depth of recession
Philadelphia Fed paper constructs index of real-time macroeconomic information, showing that the recent recession was defined by its severity relative to its length
Emerging markets need a voice: Krueger
Ex-IMF first deputy managing director Anne Krueger writes that countries such as India and China must have a presence of the international stage reflecting their weight in the global economy
Income convergence and inflation in central and eastern Europe
Bank of Estonia paper finds that income levels and inflation are correlated in the long term, but not in the short-term, with the process of convergence appearing to be slow
How the Taylor rule changed central banking for good
Kansas Fed paper shows that the rule had widespread influence and changed policymaking even when it was not adopted outright
Monetary misperceptions in a New Keynesian model
Centre for Economic Policy Research paper finds that the difference between primary and revised monetary figures captures misperceptions, which are key
Focus on fundamentals outperforms carry trades: IMF paper
International Monetary Fund paper finds that an investment strategy determined by analysis of the real effective exchange rate ultimately does better than one that relies on borrowing cheap and lending at higher rates
Bayesian reasoning in boom-bust cycles
Bank of Japan paper finds that investors cause inflations and deflations in asset prices when they base decisions on past experience of the market
Balance sheet policy and money market liquidity: SARB paper
South African Reserve Bank paper says balance sheet policy must be thought of in the same way that interest rates are regarded
Monetary-policy transmission in Mauritius
Paper examines mechanism over the past decade
A model for rate setting in Israel
Paper finds incorporating capital-market inflation expectations improves model
Crises dampen productivity: IMF paper
Rising costs negatively impact factor productivity and have implications for both monetary and fiscal policy, International Monetary Fund research finds
Inventories and the Phillips Curve
A Richmond Fed paper finds that introducing inventories into the New Keynesian model limits its ability to capture inflation dynamics
Spending and loose monetary policy cause inflation
CEPR looks for an explanation for UK inflation in the 1970s
Fifty years of monetary policy
Reserve Bank of Australia’s Glenn Stevens and economists Adam Cagliarini and Christopher Kent document the birth of inflation targeting and look to the lessons from fifty years of policymaking
Community banks remain crucial for US economy
Chicago Federal Reserve summarises its conference on the impact of the financial crisis on community banks
Ghana suited to inflation targeting: IMF paper
International Monetary Fund paper says the country does not suffer problems in credibility, which helps in the inflation targeting framework
Large shareholders take more risks
Bank of Canada analyses corporate risk taking
Middle East and North Africa’s trade below potential
International Monetary Fund looks at trade constraints in the region