Macroeconomics
Fed officials differ on outlook for US economy
Leaders agree on policy, but differ on forecasts, measures and key concerns
Paper examines US pensions’ effects on natural rate
Welfare effects of possible reforms depends on productivity growth, Bank of Italy paper finds
Book notes: Capital and ideology, by Thomas Piketty
A political pamphlet like Milton’s ‘Areopagitica’, but longer
How valuable is a PhD economist?
Heads of research from Canada, Israel and North Macedonia weigh the benefits of advanced economics education
Powell: US economy still ‘a long way’ from meeting Fed goals
Fed chair predicts continued need for low interest rates and QE, as recovery remains “uneven and far from complete”
Green finance: new initiatives in China, Europe and Americas
Eurosystem adopts common investment principles; China pushes climate modelling; and more
Riksbank proposes larger transfer to Swedish Treasury
Central bank would provide Skr6.8 billion to the government in 2021
Paper finds little evidence of long-term scarring
Richmond Fed research finds short-term demand shocks rarely create hysteresis
Fed’s 2021 stress test includes major asset price shock
CCAR will evaluate 19 largest banks; scenario includes 55% fall in equity prices
Evidence of central bank research bias is ‘mixed’ – RBA paper
Results contrast with another recent study that found bias in research on QE
Central banks look to shockproof models in wake of Covid-19
Covid-19 caused many central bank models to break down. Economists are now testing new tools
Frequent recessions push up US unemployment rate – paper
Cleveland Fed research says two decades of growth would produce 3.6% unemployment
Reserve Bank of Australia launches A$100bn in new QE
Australian central bank surprises analysts with easing measure, despite more hopeful macroeconomic forecast
Monetary unions might benefit from taxing external debt – DNB paper
Policy would reduce adverse effects of shocks to risk premia on sovereign debt, researchers find
New macroeconomic framework needed for recovery – Ghana governor
Public debt levels have breached maximum thresholds and NPLs are likely to climb, Addison says
Higher economic uncertainty is harbinger of civil conflict – Bank of Spain research
Spain suffered rising levels of economic uncertainty leading up to 1936–39 civil war
BdF paper looks at fiscal responses to liquidity traps
Infrastructure spending is more robust to model specification changes than sales tax- paper
Macro-prudential policies cut liquidity trap risk – ECB paper
Fall in systematic risk boosts natural interest rate and reduces intensity of liquidity traps, paper finds
Paper lays groundwork for Canadian ‘Hank’ model
Author estimates “earnings process” as step towards heterogeneous agent modelling
Few central banks collaborate with private-sector researchers
Collaborations are common with academia, especially in advanced economies
Agent-based models remain rare among economics departments
Economics Benchmarks 2020 highlights the varied applications of different model types at central banks
Central banks tend to mix research with policy functions
Institutions deploy a wide range of different governance frameworks when it comes to research
Semi-structural models are the forecast weapon of choice
Flexible modelling approach comes out on top; around half of central banks include a financial sector
Eurozone’s ageing is lowering interest rates – BoI paper
Natural real interest rate is likely to reach its lowest point around 2030, researcher finds