Growth
Boost technology diffusion to solve productivity puzzle – Haldane
BoE’s chief economist says a “long tail” of low-productivity firms need support as they fall further behind a small frontier group
Policy intervention helps economies escape ‘stagnation traps’ – paper
Research published by ECB explains how “pessimistic expectations” can lead to low employment and growth, dampening investment; countercyclical subsidies could be the answer
Danish GDP revision helps solve productivity puzzle – bank
Figures better capture details of the current account, leading to substantial revisions in GDP and productivity growth, the Danish central bank finds
Tech-related mismeasurement not to blame for 2004 slowdown
Fast growth between 1995 and 2004 is the “anomaly”, the authors suggest; further productivity growth is expected when the potential of latest advancements is realised
Asia needs new growth model – BoJ’s Kuroda
Region can no longer serve as “the workshop of the world” as the trade in goods slows down, says the Bank of Japan governor
Fed paper flags risk of low rates misallocating capital
Where firms rely heavily on intangible capital, lower rates could harm firms’ investment and contribute to secular stagnation, economists warn
Mongolia sees hope of recovery after rough year
The commodity reliant country faced slowing growth and inflation in 2016, but the outlook for this year is somewhat brighter
BoJ ups growth forecast after Trump shock
Improvements in overseas economies and yen weakness prompt central bank to revise up its growth forecast, though inflation is largely unchanged; policy remains on hold
Brexit pain may be coming – panel
Former Bank of England officials warn of fading consumer spending and investment
BIS authors identify tipping point in household debt impact
Researchers trace the effects of household debt on the real economy, identifying thresholds beyond which the long-run impact on consumption and growth intensifies
Dominican Central Bank reports growth of 6.6%
Provisional data from the bank shows it is the fastest growing within the region for the fourth year in a row; agriculture sector fuelling rapid growth
Book notes: The International Monetary Fund: Distinguishing Reality from Rhetoric, by Graham Bird and Dane Rowlands
The book brings valuable rigour to bear in assessing the work of the IMF, but suffers from a reliance on ageing data in many places, says Jacek Klich
LatAm should pursue regional financial integration – IMF paper
Timing is “ripe” for region to pursue financial integration as means of counterbalancing effects of departing global banks, authors say
Bank of Mexico launches cost-cutting drive
Central bank move follows government austerity drive, and includes a target of a 10% cut to the wage bill
Dutch paper looks at effects of public capital on advanced country growth
Researchers present data on 20 OECD countries
Minneapolis Fed launches new research institute
“Opportunity and inclusive growth institute” will draw on multiple disciplines to extend the Fed’s research
Inflation is ‘simply not a problem’ – Dudley
New York Fed governor not worried about risks to inflation given recent data and expects current economic expansion to continue for the foreseeable future
Eichengreen sees danger in US fiscal stimulus
Veteran economist warns infrastructure spending in the US may prove damaging to both the domestic and global economy, without necessarily fixing secular stagnation
Measurement error a big part of ‘missing growth’ – Philippe Aghion
Statistics fail to capture creative destruction, French academic argues; US researchers say productivity in IT sector points to continued puzzle
News cycle can give estimate of business cycle – Norges Bank paper
Index derived from business newspaper is both more timely and more accurate than traditional business cycle indicators, author says
Palestine Monetary Authority forecasts slowdown amid ‘political impasse’
Authority sees likelihood of “slackening trend” of growth in coming years as Gaza Strip “siege” continues and restrictions affect the West Bank
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
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
RBI paper unpacks India’s non-performing loan troubles
Authors find bank risk-taking is procyclical and the level of non-performing loans responds to the interest rate environment and the overall growth of the economy