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Blog aggregator for economics research

2018-06-18

• Rita Faria’s journal round-up for 18th June 2018
  by Rita Faria in The Academic Health Economists' Blog, 2018-06-18 11:00:47 UTC

  Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch . Objectives, budgets, thresholds, and opportunity costs—a health economics approach: an ISPOR Special Task Force report . Value in Health [ PubMed ]  Published 21st February 2018 The economic evaluation world has [...]

2018-06-16

• Jobless Recovery, Liquidity Trap, Tight Monetary Policy and the Cost Channel
  by Christian Zimmermann in NEP-DGE blog, 2018-06-16 17:52:46 UTC

  By Lasitha R.C. Pathberiya http://d.repec.org/n?u=RePEc:qld:uq2004:591&r=dge In this study, I examine the robustness of an unconventional monetary policy in a cost channel economy. The unconventional monetary policy proposed by Schmitt-Grohé and Uribe (2017, American Economic Journal: Macroeconomics, SGU henceforth), recommends a tight monetary policy during a liquidity-trapped recession to stimulate the economy and to avoid jobless recovery. The results of my study show that the existence of the cost channel implies that the SGU policy induces sharp initial contractions in the employment rate [...]

2018-06-15

• Capital Income Taxation, Economic Growth, and the Politics of Public Education
  by Christian Zimmermann in NEP-DGE blog, 2018-06-15 11:57:20 UTC

  By Tetsuo Ono and Yuki Uchida http://d.repec.org/n?u=RePEc:osk:wpaper:1805&r=dge This study considers the politics of public education and its impacts on economic growth and welfare across generations. Public education is funded by taxing the labor income of the working generation and capital income of the retired. We employ probabilistic voting to demonstrate the politics of taxes and expenditure and show that aging results in a shift of the tax burden from the old to the young and a slowdown of economic growth. We then consider three alternative constraints that limit the choice of taxes and [...]

2018-06-11

• 314 – ADOPT goes online
  by David Pannell in Pannell Discussions, 2018-06-11 15:10:59 UTC

  ADOPT is the Adoption and Diffusion Outcome Prediction Tool. It is now available as an online version, replacing the spreadsheet that has over 1000 users. I’ve previous talked about how agricultural scientists, extension agents, policy makers and suppliers need to be able to predict how farmers will respond to a new practice or technology ( PD203 ). How many farmers will adopt the new practice, and how quickly will they do so? This knowledge can influence research priorities, reserach funding decisions, the design and emphasis of extension campaigns, and the effectiveness of agricultural polic [...]

• Banks and Money, Or Watch out What You Wish For
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-06-11 12:43:55 UTC

  “[S]overeign money is an unnecessary and dangerous experiment, which would inflict great damage on our country." Thomas Jordan, Chairman, Swiss National Bank,  Speech  at the Swiss Institute of Banking and Finance, 3 May 2018 On 10 June 2008, Switzerland held a vote on the proposal that all commercial bank demand deposits be held at the central bank. It failed by a 76% to 24% vote. This Vollgeld referendum was another incarnation of the justifiable public revulsion to financial crises and the bailouts that inevitably accompany them. Vollgeld proponents claimed that a system in which the centra [...]

2018-06-10

• Sankey Diagram for the 2018 FIFA World Cup Forecast
  by Achim Zeileis in R-bloggers, 2018-06-10 22:00:00 UTC

  (This article was first published on Achim Zeileis , and kindly contributed to R-bloggers) The probabilistic forecast from the bookmaker consensus model for the 2018 FIFA World Cup is visualized in an interactive Sankey diagram, highlighting the teams’ most likely progress through the tournament. Bookmaker consensus model Two weeks ago we published our Probabilistic Forecast for the 2018 FIFA World Cup : By adjusting quoted bookmakers’ odds for the profit margins of the bookmakers (also known as overrounds), transforming and averaging them, a predicted winning probability for each [...]

2018-06-08

• Should peer to peer lenders exist in theory?
  by bankunderground in Bank Underground, 2018-06-08 08:00:21 UTC

  John Lewis Walter Heller famously said that an economist is someone who sees something in practice and wonders if it would work in theory.  Economic theory says banks exist because they channel loanable funds more efficiently than individual savers and investors pairing up bilaterally.  Those informational, diversification and maturity transformation considerations imply that banks should be able to out-compete peer to peer (P2P) lenders .  The stylised fact that few P2P platforms have made a profit to date is in line with this theory.  If so, then P2P lenders face a difficult future and they [...]

2018-06-05

• Evaluating the Distinctive Economic Impact of Historical Female Migration in the United States
  by Fernando Arteaga in NEP-HIS blog, 2018-06-05 03:00:31 UTC

  A Woman’s Touch? Female Migration and Economic Development in the United States By Viola von Berlepsch ( London School of Economics ), Andrés Rodríguez-Pose ( London School of Economics ) and Neil Lee ( London School of Economics ), Abstract :  Does the economic effect of immigrant women differ from that of immigrants in general? This paper examines if gender has influenced the short- and long-term economic impact of mass migration to the US, using Census microdata from 1880 and 1910. By means of ordinary least squares and instrumental variable estimations, the analysis shows that a greater co [...]

2018-06-04

• Italeave: Mother of all financial crises
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-06-04 11:55:24 UTC

  Nearly a decade ago, Barry Eichengreen conjured a prescient scenario for the exit of Italy from the euro: “ Households and firms anticipating that domestic deposits would be redenominated into lira, which would then lose value against the euro, would shift their deposits to other euro area banks. In the worst case, a system-wide bank run could follow. Investors anticipating that their claims on the Italian government would be redenominated into lira would presumably shift into claims on other euro area governments, leading to a bond market crisis. If the precipitating factor was parliamentary [...]

2018-06-01

• Some Fairly Recent Must- and Should-Reads About Globalization
  by ? in Grasping Reality with the Invisible Hand, 2018-06-01 21:01:49 UTC

  Ken Schultz: "I’m not an IPE expert, but it seems like you must be doing tariffs wrong if they aren’t even supported by the labor union in the protected industry..." Paul Krugman: Oh, What a Stupid Trade War: "Even if tariffs were expansionary, that w [...]

• Protecting Customers’ Privacy Requires More than Anonymizing Their Data
  by Sachin Gupta in HBR Blog Network, 2018-06-01 14:00:49 UTC

  Becky Hayes/EyeEm/Getty Images Today, good marketing relies on having detailed and accurate customer data. And companies, not surprisingly, are eager to collect vast troves of it. For instance, Amazon continuously tracks the behaviors of its 100 million Prime members , an example of “first-party” data. And many companies have found that sharing their own customer information with other companies creates synergies for both parties, especially with the increasing availability of “internet of things” data (GPS sensors, smart utility meters, fitness devices, etc.). These are examples of “secon [...]

• Why the MPC needs experts
  by chris in Stumbling and Mumbling, 2018-06-01 13:33:58 UTC

  There’s no doubt that Jonathan Haskel is an excellent appointment to the MPC. What we should be asking is rather: isn’t he over-qualified? What I mean is that not much hangs upon interest rate decisions. The Bank’s own work estimates that a quarter-point rise reduces output only by around 0.15%. Granted, it’s possible that the economy might now be more sensitive than this to rate changes now. But even so, the cost of interest rate mistakes are small. Put it this way. For a monetary policy error to have had the same cost as fiscal austerity or Brexit, interest rates would have had to rise to we [...]

• Suggested Reading for June
  by Dave Giles in Econometrics Beat: Dave Giles' Blog, 2018-06-01 12:49:00 UTC

  Colussi, T. , 2018. Social ties in academia: A friend is a treasure. Review of Economics and Statistics , 100, 45-50. Dette, H., K. Möllenhoff, S. Volgushev, & F. Bretz , 2018. Equivalence of regression curves. Journal of the American Statistical Association , online. Kumbhaker, S. C., C. F. Parmeter, & V. Zelenyuk , 2018. Stochastic frontier analysis: Foundations and advances. Working paper No. WP02/2018, Centre for Efficiency and productivity Analysis, School of Economics, University of Queensland. Morshed, A. A., E. Andreou, & O. Boldea , 2018. Structural break tests robust to regression mi [...]

• Statistics: Brazil will play Germany in the FIFA World Cup final
  by ? in Brinkwire, 2018-06-01 08:16:59 UTC

  [...]

2018-05-31

• Building Height and Greenhouse Gas Emissions: The Case of New York City
  by Jason Barr in Building the skyline, 2018-05-31 15:06:50 UTC

  Jason M. Barr      May 31, 2018 A growing body of research demonstrates that across the United States there is significant variation in household greenhouse gas emissions. [1] Regionally speaking, the “sweet spots” are those places with warm winters and cool summers , such as California. Within regions, however, CO 2 emissions have an inverted u-shape . Starting in the rural areas, household carbon production tends to be low or moderate. Moving toward suburban areas, emissions rise and then peak. They then fall in the densest central parts of the city. The reason is due first to income. Wealth [...]

• Comprendiendo la severidad de las crisis financieras españolas
  by admin in Nada Es Gratis, 2018-05-31 05:01:24 UTC

  De Concha Betrán y María A. Pons Tras la crisis de 2008 se han publicado numerosos trabajos cuyo objetivo es explicar los principales determinantes de las crisis financieras. Los dos factores más destacados en el debate actual son los desequilibrios externos generados por el endeudamiento exterior (o entradas netas de flujos internacionales de capital) y el endeudamiento interno (o expansión del crédito). Las últimas décadas del siglo XX y el inicio del siglo XXI se caracterizaron por la acumulación de fuertes desequilibrios de balanza por cuenta corriente que podrían estar detrás del origen [...]

2018-05-30

• Ученые оценили вероятность успеха каждой из команд на чемпионате мира по футболу
  by ? in N+1: научные статьи, новости, открытия, 2018-05-30 17:10:34 UTC

  Австрийские математики оценили вероятность победы каждой из команд на стартующем 14 июня чемпионате мира по футболу. [...]

2018-05-29

• ECB research provides a withering critique of mainstream macroeconomics
  by bill in Bill Mitchell - billy blog, 2018-05-29 03:30:31 UTC

  Although this blog post considers some very technical material its message is simple. Mainstream macroeconomic models that are used to determine policy choices by governments are deeply flawed and the evidence strongly supports a central thrust of Modern Monetary Theory (MMT) – that fiscal policy is powerful and that austerity will kill growth. In that sense, it helps us understand why various nations and blocs (such as the Eurozone) struggled after the onset of the GFC. It also explains why the deliberate attack on Greek prosperity by the Troika was so successful in demolishing any prospect o [...]

• The Economic Consequences of the Napoleonic Wars
  by guidoalfani in NEP-HIS blog, 2018-05-29 02:35:41 UTC

  The Napoleonic Wars: A Watershed in Spanish History? By Leandro Prados de la Escosura ( Carlos III University de Madrid ) and Carlos Santiago-Caballero ( Carlos III University de Madrid ). Abstract : The Napoleonic Wars had dramatic consequences for Spain’s economy. The Peninsular War had higher demographic impact than any other military conflict, including civil wars, in the modern era. Farmers suffered confiscation of their crops and destruction of their main capital asset, livestock. The shrinking demand, the disruption of international and domestic trade, and the shortage of inputs hampere [...]

2018-05-28

• Dr. Krugman on Coal Miners and Coal Towns
  by Matthew Kahn in Environmental and Urban Economics, 2018-05-28 15:22:00 UTC

  San Francisco, New York, Boston, Los Angeles, Seattle, and Portland are booming.� Such areas offer great opportunities for our best young minds.� These progressive cities limit housing supply and this limits population growth, causes suburbanization, and contributes to sky high local real estate prices.� Moretti's local multiplier effect hypothesis posits that the booming local economy creates local opportunity for middle class people. We all know that other places are not doing well.� The geography of upward mobility and despair is a major research topic. Raj Chetty claims that "place" is cen [...]

• To Form a More Perfect Union
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-05-28 11:38:54 UTC

  “In a monetary union with the consequent financial integration, there are features like centralised supervision, deposit insurance and resolution of banks…that are necessary for the whole framework to function effectively.” ECB Vice President Vítor Constâncio, 17 May 2018 . On 31 May 2018, Vítor Constâncio completes 18 years on the Governing Council of the European Central Bank (ECB)—8 as Vice President and 10 as Governor of the Bank of Portugal before that. Ahead of his departure, Vice President Constâncio delivered a valedictory address setting out his views on what needs to be done to make [...]

• Alastair Canaway’s journal round-up for 28th May 2018
  by captaincanaway in The Academic Health Economists' Blog, 2018-05-28 11:00:22 UTC

  Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch . Information, education, and health behaviours: evidence from the MMR vaccine autism controversy . Health Economics [ PubMed ] Published 2nd May 2018 In 1998, Andrew Wakefield published (in the Lancet) his infamo [...]

2018-05-27

• Some Fairly Recent Must- and Should-Reads About: Political Economy
  by ? in Grasping Reality with the Invisible Hand, 2018-05-27 15:31:57 UTC

  David Glasner: Neo- and Other Liberalisms: "The point of neoliberalism 1.0 was to moderate classical laissez-faire liberal orthodoxy... Not quite true. It is what the Left New Dealers' consensus was. They had lost power in the U.S. But enough of them ma [...]

2018-05-26

• Saturday assorted links
  by Tyler Cowen in Marginal Revolution, 2018-05-26 15:54:18 UTC

  1. East Germans still buy fewer stocks . 2. New results about crypto and the stock market that neither Samir Varma nor I can quite bring ourselves to believe . 3. A somewhat off-base but still interesting thread on housing supply . 4. This is the kind of rhetorical and blah blah blah piece I don’t usually link to, yet the main point is correct and still underappreciated: there is a crisis of European weakness . 5.  Do Chinese communists fund Jacinda Ardern’s NZ Labour Party ? 6.  Jonathan Rauch replies to Rosser on happiness . The post Saturday assorted links appeared first on Marginal REVOLUT [...]

2018-05-24

• Are economists’ standard solutions part of the problem in fragile states?
  by Tobias Haque in Development Policy Blog, 2018-05-24 20:00:42 UTC

  Work to be done International development agencies are being asked to do more about conflict and fragility . In the wake of the Arab spring and the spread of conflict among middle-income countries, and with many of the poorest states continuing to experience protracted conflicts, the international community is calling on aid agencies to do more and spend more in conflict contexts. This call to action extends beyond humanitarian and peacebuilding interventions, and encompasses institutions with explicit economic development mandates, such as the World Bank and IMF. But what do those of us conce [...]

2018-05-22

• Are Macroprudential Tools as Caring and Forethinking as They Claim to Be? Financial Stability and Monetary Policy in the Long Run
  by chechurris in NEP-HIS blog, 2018-05-22 04:06:21 UTC

  An Historical Perspective on the Quest for Financial Stability and the Monetary Policy Regime By Michael D. Bordo ( Rutgers University ) Abstract: This paper surveys the co-evolution of monetary policy and financial stability for a n umber of countries across four exchange rate regimes from 1880 to the present. I present historical evidence on the incidence, costs and determinants of financial crises, combined with narratives on some famous financial crises. I then focus on some empirical historical evidence on the relationship between credit booms, asset price booms and serious financial cri [...]

2018-05-21

• Making Unelected Power Legitimate
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-05-21 12:24:46 UTC

  “[W]hile many democratic societies have independent central banks, everyone leaves tax policy in the hands of elected officials.” Alan S. Blinder, Central Bank in Theory and Practice , page 59. Through what administrative means should a democratic society in an advanced economy implement regulation? How can we promote the various interests of the people efficiently , while being faithful to the evolving wishes of the majority? Ultimately, these are questions of legitimacy. However effective a form of administration may be, its sustainability in a democracy depends on maintaining the trust of t [...]

2018-05-20

• Ethics of Behavioural Science Policy
  by Liam Delaney in Economics, Psychology and Policy, 2018-05-20 18:20:00 UTC

  One of the three key themes of the new group in Dublin will be to examine the ethical aspects of behavioural science applications in policy. See the link here for a recent workshop we conducted in this area joint with Stirling Behavioural Science Centre and Newcastle University Law School. The readings below gives a sense of the interest in the ethical implications of nudging. I have been updating this list throughout the last three years as part of developing our teaching programme. But more generally, ethical issues are always worth thinking about when devising and evaluating interventions t [...]

2018-05-18

• Method of the month: custom likelihoods with Stan
  by Sam Watson in The Academic Health Economists' Blog, 2018-05-18 06:00:27 UTC

  Once a month we discuss a particular research method that may be of interest to people working in health economics. We’ll consider widely used key methodologies, as well as more novel approaches. Our reviews are not designed to be comprehensive but provide an introduction to the method, its underlying principles, some applied examples, and where to find out more. If you’d like to write a post for this series, get in touch . This month’s method is custom likelihoods with Stan . Principles Regular readers of this blog will know that I am a fan of Bayesian methods. The exponential growth in perso [...]

• Centralized vs. Decentralized Social Welfare Maximizers
  by Eric Falkenstein in Falkenblog, 2018-05-18 01:06:00 UTC

  Faith in a select group of public servants to maximize social welfare is no better founded than the belief in the supernatural gifts of kings or noblemen. Just as misguided is the idea that good things, as decided by a majority, should be mandated. It should be remembered that our current prosperity and freedom have resulted from unwanted gradual changes in mores related to property rights, which when firmly established sparked the Industrial Revolution. Nobody planned that. Property rights were not created to win wars or eliminate poverty, though they did that as well as many other good thing [...]

2018-05-17

• Religion and the European Union
  by maximorossi in NEP-LTV blog, 2018-05-17 20:24:46 UTC

  By: Benito Arruñada  ;  Matthias Krapf We review a recent literature on cultural differences across euro member states.We point out that this literature fails to address cultural differences between Protestants and Catholics, which are likely a major underlying reason for cross-country differences. We argue that confessional culture explains why Catholic countries tend to have weaker institutions but are more open to economic and political integration. EU policies after the economic crisis looked clumsy and failed to address all concerns, but were viable, caused only a manageable amount [...]

• Immigration and the Future of the Welfare State in Europe
  by maximorossi in NEP-LTV blog, 2018-05-17 20:23:56 UTC

  By: Alberto Alesina  (Harvard University [Cambridge], IGIER) ;  Johann Harnoss  (UP1 – Université Panthéon-Sorbonne) ;  Hillel Rapoport  (PJSE – Paris Jourdan Sciences Economiques – UP1 – Université Panthéon-Sorbonne – ENS Paris – École normale supérieure – Paris – INRA – Institut National de la Recherche Agronomique – EHESS – École des hautes études en sciences sociales – ENPC – École des Ponts ParisTech – CNRS – Centre National de la Recherche Scientifique, PSE – Paris School of Economics) We analyze the effect of immigration on attitudes to redistribution in Europe. Using data for [...]

• The Welfare Implications of Addictive Substances: A Longitudinal Study of Life Satisfaction of Drug Users
  by maximorossi in NEP-LTV blog, 2018-05-17 20:23:15 UTC

  By: Julie Moschion  (Melbourne Institute: Applied Economic & Social Research, The University of Melbourne) ;  Nattavudh Powdthavee  (Warwick Business School; and Centre for Economic Performance, London School of Economics) This paper provides an empirical test of the rational addiction model, used in economics to model individuals’ consumption of addictive substances, versus the utility misprediction model, used in psychology to explain the discrepancy between people’s decision and their subsequent experiences. By exploiting a unique data set of disadvantaged Australians, we provide long [...]

• Evaluating intergenerational persistence of economic preferences: A large scale experiment with families in Bangladesh
  by maximorossi in NEP-LTV blog, 2018-05-17 20:22:25 UTC

  By: Chowdhury, Shyamal  (University of Sydney, and IZA Bonn) ;  Sutter, Matthias  (Max Planck Institute for Research on Collective Goods Bonn, and University of Cologne) ;  Zimmermann, Klaus F.  (UNU-MERIT) Economic preferences – like time, risk and social preferences – have been shown to be very influential for real-life outcomes, such as educational achievements, labour market outcomes, or health status. We contribute to the recent literature that has examined how and when economic preferences are formed, putting particular emphasis on the role of intergenerational transmission of [...]

• Explaining cross-state earnings inequality differentials in India: An RIF decomposition approach
  by maximorossi in NEP-LTV blog, 2018-05-17 20:20:56 UTC

  By: Carlos Gradín Despite the relevance of geographical disparities in India, earnings inequality occurs mostly within states, but with a broad range of variability in its levels. We investigate the sources of such variability using RIF decompositions of the inequality gaps between most populous states and India. Our results point to substantial compositional effects associated with cross-state variability in the extent of high-skilled formal employment outside the farm and construction sectors, and along the degree of urbanization and some demographic factors. Cross-state differences in [...]

• Revisiting Gender Differences in Ultimatum Bargaining: Experimental Evidence from the US and China
  by maximorossi in NEP-LTV blog, 2018-05-17 20:00:29 UTC

  By: Shuwen Li  (Interdisciplinary Center for Economic Science and Department of Economics, George Mason University) ;  Xiandong Qin  (Department of Applied Economics, Shanghai Jiao Tong University) ;  Daniel Houser  (Interdisciplinary Center for Economic Science and Department of Economics, George Mason University) We report results from a replication of Solnick (2001), which finds using an ultimatum game that, in relation to males, more is demanded from female proposers and less is offered to female responders. We conduct Solnick†s (2001) game using participants from a large US univer [...]

• Welfare Analysis and Redistributive Policies
  by maximorossi in NEP-LTV blog, 2018-05-17 19:59:29 UTC

  By: Bargain, Olivier Applied welfare analyses of redistributive systems nowadays benefit from powerful tax benefit microsimulation programs combined with administrative data. Arguably, most of the distributional studies of that kind focus on social welfare defined as a function – typically inequality or poverty indices – of household equivalized income. In parallel, economic research has made considerable progress in the measurement of welfare along several dimensions. Distinct but related branches of the literature have attempted (i) to model different behaviour (in a way that m [...]

• Gender: An Historical Perspective
  by maximorossi in NEP-LTV blog, 2018-05-17 19:58:24 UTC

  By: Giuliano, Paola Social attitudes toward women vary significantly across societies. This chapter reviews recent empirical research on various historical determinants of contemporary differences in gender roles and gender gaps across societies, and how these differences are transmitted from parents to children and therefore persist until today. We review work on the historical origin of differences in female labor-force participation, fertility, education, marriage arrangements, competitive attitudes, domestic violence, and other forms of difference in gender norms. Most of the res [...]

• The Long-Lasting Effects of Family and Childhood on Adult Wellbeing: Evidence from British Cohort Data
  by maximorossi in NEP-LTV blog, 2018-05-17 19:57:21 UTC

  By: Andrew E. Clark  ;  Sarah Flèche  ;  Warn N. Lekfuangfu To what extent do childhood experiences continue to affect adult wellbeing over the life course? Previous work on this link has been carried out either at one particular adult age or for some average of adulthood. We here use two British birth-cohort datasets (the 1958 NCDS and the 1970 BCS) to map out the time profile of the effect of childhood on adult outcomes, including life satisfaction. We find that the effect of many aspects of childhood do not fade away over time, but are rather remarkably stable. In both birth cohorts c [...]

• Understanding Cultural Persistence and Change
  by maximorossi in NEP-LTV blog, 2018-05-17 19:54:59 UTC

  By: Paola Giuliano  ;  Nathan Nunn When does culture persist and when does it change? We examine a determinant that has been put forth in the anthropology literature: the variability of the environment from one generation to the next. A prediction, which emerges from a class of existing models from evolutionary anthropology, is that following the customs of the previous generation is relatively more beneficial in stable environments where the culture that has evolved up to the previous generation is more likely to be relevant for the subsequent generation. We test this hypothesis by meas [...]

2018-05-15

• Sovereign Money Reforms and Welfare
  by Christian Zimmermann in NEP-DGE blog, 2018-05-15 16:09:59 UTC

  By Philippe Bacchetta and Elena Perazzi http://d.repec.org/n?u=RePEc:lau:crdeep:18.02&r=dge A monetary reform is submitted for vote to the Swiss people in 2018. The Sovereign Money Initiative proposes that all sight deposits should be controlled by the Swiss National Bank (SNB) and that the SNB could distribute its additional resources. While a sovereign money reform would clearly affect the structure of the banking sector, it would also have macroeconomic implications, in particular because it transfers resources from banks to the central bank. The objective of this paper is to analyze these [...]

2018-05-14

• La théorie du ruissellement existe-t-elle ?
  by Antoine Belgodere in Optimum, 2018-05-14 23:00:00 UTC

  "Si l'on commence à jeter des cailloux sur les premiers de cordée c'est toute la cordée qui dégringole", déclarait le président Macron en octobre dernier. Cette phrase est une illustration assez parfaite de ce qu'on appelle la "théorie du ruissellement" (Trickle down theory en anglais). Cette théorie veut que l'enrichissement des plus riches finisse par bénéficier à terme aux masses. Ne vous précipitez toutefois pas sur google pour savoir qui est l'inventeur de cette théorie. A l'instar du néolibéralisme ou de la théorie du genre, il s'agit d'une étiquette dont personne ou presque ne se ré [...]

• Finance and the Blockchain: A Primer
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-05-14 11:37:17 UTC

  “Only 1% of 3,138 chief information officers at companies surveyed by Gartner last year said they had ‘any kind of blockchain adoption’….” The Wall Street Journal , May 7, 2018. Blockchain is all the rage. We are constantly bombarded by reports of how it will change the world. While it may alter many aspects of our lives, our suspicion is that they will be in areas that we experience only indirectly. That is, blockchain technology mostly will change the implementation of invisible processes—what businesses think of as their back-office functions. In this post, we briefly describe blockchain te [...]

• Crisis, contagion and international policy spillovers under foreign ownership of banks
  by Christian Zimmermann in NEP-DGE blog, 2018-05-14 04:15:06 UTC

  By Michał Brzoza-Brzezina, Marcin Kolasa and Krzysztof Makarski http://d.repec.org/n?u=RePEc:fme:wpaper:18&r=dge This paper checks how international spillovers of shocks and policies are modified when banks are foreign owned. To this end we build a two-country macroeconomic model with banking sectors that are owned by residents of one (big and foreign) country. Consistently with empirical findings, in our model foreign ownership of banks amplifies spillovers from foreign shocks. It also strengthens the international transmission of monetary and macroprudential policies. We next use the model t [...]

2018-05-13

• Time-Consistent Consumption Taxation
  by Christian Zimmermann in NEP-DGE blog, 2018-05-13 03:44:28 UTC

  By Sarolta Laczo and Raffaele Rossi http://d.repec.org/n?u=RePEc:qmw:qmwecw:857&r=dge We characterise optimal tax policies when the government has access to consumption taxation and cannot credibly commit to future policies. We consider a neoclassical economy where factor income taxation is distortionary within the period, due to endogenous labour and capital utilisation and non-tax-deductibility of depreciation. Contrary to the case where only labour and capital income are taxed, the optimal time-consistent policies with consumption taxation are remarkably similar to their Ramsey counterpar [...]

2018-05-12

• Editors’ Briefing: This Week in Political Economy (May 4–May 12)
  by ProMarket writers in Pro-Market, 2018-05-12 13:37:22 UTC

  A whistleblower alleges fraud in the audits of Silicon Valley companies; AT&T acknowledges that hiring Michael Cohen was a “bad mistake”;  new analysis finds that Amazon has not been consistent with the stated selection criteria for HQ2; and a majority of Americans  back a constitutional amendment that would outlaw Citizens United. This week in political economy.      Photo by Luismt94  [ CC BY-SA 4.0 ], via Wikimedia Commons   POGO (Project on Government Oversight) reports on the story of Mauro Botta, a former senior manager at PricewaterhouseCoopers who decided to become a whistleblower af [...]

2018-05-11

• On the effects of ranking by unemployment duration
  by Christian Zimmermann in NEP-DGE blog, 2018-05-11 18:53:45 UTC

  By Javier Fernandez-Blanco and Edgar Preugschat http://d.repec.org/n?u=RePEc:pra:mprapa:85310&r=dge We propose a theory based on the firm’s hiring behavior that rationalizes the observed significant decline of callback rates for an interview and exit rates from unemployment and the mild decline of reemployment wages over unemployment duration. We build a directed search model with symmetric incomplete information on worker types and non-sequential search by firms. Sorting due to firms’ testing of applicants in the past makes expected productivity fall with duration, which induces firms to rank [...]

• Job Guarantee: Marxist or Keynesian?
  by chris in Stumbling and Mumbling, 2018-05-11 13:07:19 UTC

  For decades there has been a debate about the differences and similarities between Marx and Keynes. The question of whether we should introduce a job guarantee highlights this debate: is it a means of supporting capitalism, or a challenge to it? A job guarantee is the offer by the government of a job at a living wage to anybody that wants one. This would, in effect, eliminate involuntary unemployment. Pavlina Tcherneva has a nice paper (pdf) describing the details. Other advocates of it are Randy Wray (pdf)   and colleagues , FitzRoy and Jin (pdf) , Paul, Darity and Hamilton and Wisman and Pac [...]

2018-05-10

• Who is the "Marginal" New California Solar Home?
  by Matthew Kahn in Environmental and Urban Economics, 2018-05-10 17:45:00 UTC

  A new law in California will require that every new home built starting in 2020 must have solar panels.� �I have studied the housing price premium commanded by solar homes in t his an d this paper. Who is this new law binding for?� There are homes that would not have installed solar panels in the absence of the law.� This is the "marginal set". An energy economist will ask the following questions; 1. Where are these homes? Does the sun shine brightly on these areas?� That the home owners would not have chosen to install solar suggest the answer. 2. What is the hourly price of electricity in th [...]

• Ugly Architecture: 130 Years of Manhattan Skyscraper Complaints
  by Jason Barr in Building the skyline, 2018-05-10 12:51:41 UTC

  Jason M. Barr     May 10, 2018 Critics of Manhattan’s new supertall superslim buildings have a laundry list of complaints . One particular trope is that they are ugly and out of scale with their surroundings. While I believe it’s important to debate the pros and cons of tall buildings, it’s also important to keep in mind that today’s beefs continue a 130-year tradition of grousing about skyscrapers. In this vein, I thought it might be worthwhile to give a short pop quiz. I will give you 10 quotes from architectural critics from 1890 to the present. Try to give (a) the year the quote was made, [...]

• Estado del Bienestar y democracia en España: una perspectiva de muy largo plazo
  by admin in Nada Es Gratis, 2018-05-10 05:01:14 UTC

  De Sergio Espuelas Seguramente uno de los principales cambios ocurridos a lo largo del siglo XX ha sido la aparición del Estado del Bienestar. Antes de la primera guerra mundial el gasto público en protección social en los países de la OCDE apenas representaba un 0,5-1% del PIB, mientras que en la actualidad supera el 20% del PIB (ver aquí y aquí ). Este crecimiento ha permitido ofrecer servicios que hoy ya se consideran básicos, como las pensiones y la atención sanitaria, a amplios sectores de la población; pero también ha generado dudas sobre la sostenibilidad futura de estas políticas como [...]

• Competitiveness and Wage Bargaining Reform in Italy
  by Christian Zimmermann in NEP-DGE blog, 2018-05-10 04:05:49 UTC

  By Alvar Kangur http://d.repec.org/n?u=RePEc:imf:imfwpa:18/61&r=dge The growth of Italian exports has lagged that of euro area peers. Against the backdrop of unit labor costs that have risen faster than those in euro area peers, this paper examines whether there is a competitiveness challenge in Italy and evaluates the framework of wage bargaining. Wages are set at the sectoral level and extended nationally. However, they do not respond well to firm-specific productivity, regional disparities, or skill mismatches. Nominally rigid wages have also implied adjustment through lower profits and emp [...]

2018-05-09

• Natural Rates
  by Stephen Williamson in Stephen Williamson: New Monetarist Economics, 2018-05-09 19:56:00 UTC

  The natural rate of unemployment is not something we hear a lot about in academic circles these days, and it's out of fashion even in some central banks. I was out of town when this happened, but when I was working for the St. Louis Fed, Larry Meyer showed up at the Fed to talk to economists in the Research Department. One of things he wanted to know was our estimate of the natural rate of unemployment. Meyer seemed offended, apparently, that we had never thought about it. He didn't know that it's hard to find anyone at the St. Louis Fed who would take the Phillips curve, let alone the natural [...]

2018-05-07

• Human capital around the globe : How to measure the human input in GDP
  by ? in FRED blog, 2018-05-07 13:00:53 UTC

  View on GeoFRED ® What does it take to produce stuff? On a basic level, you need means of production: raw materials, land, some machinery, some structure, and humans. Gross domestic product (GDP) is the measure of all the stuff produced in a country (in each quarter or each year) and depends heavily on the means of production. Today, we look at the human component. How much humans influence GDP depends on essentially two things: how much they work and how good they are at working. The latter is obviously a little difficult to measure, especially if you want to look at the input angle. We can m [...]

• Banking the Masses: 2018 Edition
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-05-07 12:07:20 UTC

  “Financial inclusion is not an end in itself but a means to an end…” Demirgüç-Kunt et al, The Global Findex Database 2017 , page 80, World Bank, April 2018. The two leading financial trends of our time are the integration of digital technology and the advance of financial inclusion. The latter involves both provision of access to those who have no account (the “unbanked”) and increased usage of financial services by those with a tenuous link to the formal system (the “underbanked”). A combination of swift technological change and government promotion is speeding the rise of inclusion. Six year [...]

• Chris Sampson’s journal round-up for 7th May 2018
  by Chris Sampson in The Academic Health Economists' Blog, 2018-05-07 11:00:17 UTC

  Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch . Building an international health economics teaching network . Health Economics [ PubMed ]  Published 2nd May 2018 The teaching on my health economics MSc (at Sheffield) was very effective. Experts from our subdi [...]

2018-05-06

• Neo Fisherism: Look, it Works!
  by Stephen Williamson in Stephen Williamson: New Monetarist Economics, 2018-05-06 01:13:00 UTC

  We know that Neo-Fisherism works in our models. In baseline macroeconomic models in which money is neutral, increases in inflation and increases in nominal interest rates go hand-in-hand. If we incorporate standard types of frictions that give rise to monetary non-neutralities in our models, for example New Keynesian sticky prices or segmented markets, an increase in the central bank's nominal interest rate target will in general raise inflation - in the short run and in the long run. See for example Cochrane (2016), Rupert and Sustek (2016), and Williamson (2018). And note that these theoreti [...]

2018-05-05

• Start-uppers : l’angoisse derrière le rêve
  by The Conversation in Contrepoints, 2018-05-05 03:30:37 UTC

  Par Romain Buquet, Nathalie Luca et Jean-Philippe Bouilloud 1 . Un article de The Conversation Les start-uppers sont souvent présentés (et perçus) comme des figures de la puissance et du succès. Les exemples d’ Elon Musk, PDG de Tesla et SpaceX , ou de Jeff Bezos, PDG d’Amazon , sont particulièrement frappants : chacune de leurs interventions est scrutée, commentée et reprise dans le monde entier. Cette fièvre entrepreneuriale contamine les décideurs publics comme les jeunes diplômés. Devant une telle unanimité en faveur de l’entrepreneuriat, les chercheurs en gestion analysent le passionnant [...]

2018-05-04

• Progress in economics
  by chris in Stumbling and Mumbling, 2018-05-04 11:43:28 UTC

  I’m getting cheesed off with the economic culture war . One peeve I have with it is that economists do so many things that it’s easy to find examples of both bad work and good . Rather than speak in generalities, I’d prefer critics and defenders to focus more upon specific aspects of economics. As an example of what I mean, I’ll take a bit of financial economics, as this might highlight what’s both good and bad in economics. For years, we’ve had a mainstream theory here. The efficient market hypothesis says that all information is embedded into share prices and so you cannot beat the market wi [...]

2018-05-03

• Por nuestros nombres nos conoceréis (o no)
  by Pedro Rey Biel in Nada Es Gratis, 2018-05-03 04:50:43 UTC

  De  Pedro Rey Biel   ( @pedroreybiel ) En este blog tenemos ciertas obsesiones recurrentes y una tendencia a mirarnos el ombligo (!perdón!). Tanto es así, que Santiago Sánchez ya publicó una entrada estupenda sobre el tema de mi entrada de hoy hace un par de años. No obstante, hoy quiero juntar nuestra obsesión con cómo medir la productividad individual con el hablar sobre nuestra profesión académica. Creo que les resultará curioso entender cómo la forma de medir las contribuciones a los artículos de investigación de los académicos puede llevar a comportamientos estratégicos curiosos y a que p [...]

2018-05-01

• What did Monty Python metaphors ever do for us?
  by Tony Yates in longandvariable, 2018-05-01 09:54:34 UTC

  Tim Harford’s excellent adaptation of Monty Python in the face of generalized attacks on the economics discipline rather overshadows the other contributions, including mine, to the FT pieces published as a response to the Tom Clark / Chris Giles debate. The piece by me was a crop of what I am reposting below, reproduced because the FT version does not contain the hyperlinks to other work, which were there to make a point about what is actually out there in econ that you can read.  And also because it chopped a paragraph on money, something Tom Clark seemed to suggest was ‘rarely discussed’.  [ [...]

2018-04-30

• Sam Watson’s journal round-up for 30th April 2018
  by Sam Watson in The Academic Health Economists' Blog, 2018-04-30 15:30:48 UTC

  Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch . The Millennium Villages Project: a retrospective, observational, endline evaluation . The Lancet Global Health. [ PubMed ]  Published May 2018. There are some clinical researchers who would have you believe obse [...]

• On forecasting failures
  by chris in Stumbling and Mumbling, 2018-04-30 13:17:29 UTC

  Economists take a lot of stick for their inability to foresee crises and recessions. But I wonder: wouldn’t it be fairer to chastise politicians for their lack of foresight? Two current events make me ask. One is the scandal about Windrushers being deported.  This injustice was not just foreseeable but foreseen. Ministers were warned of it two years ago. It should be no surprise that a “hostile environment” and crude targets would hit law-abiding British citizens. As I said in 2016: Just as “anti-terror” laws have been used to harass journalists and peaceful protestors, so immigration control [...]

2018-04-26

• Feldstein Meets George: Land Rent Taxation and Socially Optimal Allocation in Economies with Environmental Externality
  by Christian Zimmermann in NEP-DGE blog, 2018-04-26 19:12:10 UTC

  By Nguyen Thang Dao and Ottmar Edenhofer http://d.repec.org/n?u=RePEc:ces:ceswps:_6937&r=dge We consider an overlapping generations (OLG) economy with land as a fixed factor of production and an environmental externality on production in which tax revenue from land rent and/or from other schemes such as labor income, capital income, and production taxation can be used for environmental protection through investment in emission mitigation. We show that, for any given target of stationary stock of pollution, the land rent taxation scheme leads to a higher steady state capital accumulation than [...]

2018-04-25

• Method of the month: Eye-tracking
  by carolinemvass in The Academic Health Economists' Blog, 2018-04-25 06:00:25 UTC

  Once a month we discuss a particular research method that may be of interest to people working in health economics. We’ll consider widely used key methodologies, as well as more novel approaches. Our reviews are not designed to be comprehensive but provide an introduction to the method, its underlying principles, some applied examples, and where to find out more. If you’d like to write a post for this series, get in touch . This month’s method is eye-tracking . Principles Eye-tracking methods can be used to analyse how individuals acquire information and how they make decisions. The method has [...]

• The Wealth of the Other Americas
  by Thales ZP in NEP-HIS blog, 2018-04-25 01:01:24 UTC

  The Industrialization of South America Revisited: Evidence from Argentina, Brazil, Chile and Colombia, 1890-2010 Gerardo della Paolera ( Central European University ), Xavier Durán ( Universidad de los Andes ), Aldo Musacchio ( Brandeis University ) Abstract:  We use new manufacturing GDP time series to examine the industrialization in Argentina, Brazil, Chile, and Colombia since the early twentieth century. We uncover variation across countries and over time that the literature on industrialization had overlooked. Rather than providing a single explanation of how specific shocks or policies s [...]

2018-04-23

• Universal Central Bank Digital Currency?
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-04-23 11:54:13 UTC

  “History is filled with attempts to invent money. People want to make a quick buck, literally.” Agustín Carstens, General Manager of the BIS, 17 April 2018 . Digital currency is all the rage. Bitcoin has more than one thousand crypto cousins . There is even a token called dentacoin, whose issuers claim it will transform dentistry! In the past, we have been clear in our views. We agree with Agustín Carstens: these are exactly like past attempts of people to issue their own private money. As Carstens said on another occasion, these tokens are “ a combination of a bubble, a Ponzi scheme and an en [...]

2018-04-21

• États-Unis : le drame du salaire minimum
  by Philippe Lacoude in Contrepoints, 2018-04-21 02:40:40 UTC

  Par Philippe Lacoude. Dans le volet précédent , nous avons délibérément occulté une raison pour laquelle le chômage est si bas aux États-Unis : le salaire minimum y est relativement moindre comparé à celui de la France. Mais avant de nous pencher sur la question du salaire minimum aux États-Unis, il nous faut probablement faire un détour par le marché de la baguette de pain en France. Le marché de la baguette de pain Supposons que nous sommes dans une ville moyenne qui a une dizaine de boulangeries qui produisent chacune 1000 baguettes – soit 10000 baguettes au total – et que compte-tenu de l’ [...]

2018-04-20

• Quotation of the Day…
  by Don Boudreaux in Cafe Hayek, 2018-04-20 10:33:09 UTC

  (Don Boudreaux) Tweet … is from page 417 of my late colleague Gordon Tullock’s 1997 paper “ Thoughts about Representative Government ” as this essay is reprinted in volume 4 ( The Economics of Politics ) of Tullock’s Selected Works (Charles K. Rowley, ed., 2005): In general, the bills themselves are written by the civil service, by congressional assistants, or, in many cases, by special interests who offer “advice” sometimes in the form of completely worked out pieces of legislation. [...]

• Contro le disuguaglianze prescrivere il liceo
  by Gianluca Argentin e Carlo Barone in La Voce, 2018-04-20 08:32:28 UTC

  In terza media gli studenti ricevono dai professori un orientamento per la scelta della scuola superiore. Che di rado è il liceo per chi proviene da famiglie poco istruite. Si perpetuano così le disuguaglianze sociali. Eppure, basta poco per cambiare. Una scelta cruciale La scelta della scuola superiore è lo snodo decisivo dei percorsi scolastici in Italia. Iscriversi a un liceo, invece che a un istituto tecnico o professionale, condiziona in modo determinante le possibilità di proseguire all’università e raggiungere la laurea, con forti conseguenze sui futuri percorsi occupazionali. Purtropp [...]

• [経済]時変的なフィリップスの相関
  by himaginary in himaginaryの日記, 2018-04-20 00:00:00 UTC

  気付くのが遅くなったが、 ここ や ここ で紹介したAndolfatto＝クルーグマン論争にTony Yatesも 反応し 、表題のLuca Benatiの 2007年論文 （原題は「The Time-Varying Phillips Correlation」）を引き合いに出している。 以下は同論文の要旨。 We use complex demodulation techniques to investigate changes in the correlation between real activity and inflation at the business-cycle frequencies in the United States, the United Kingdom, the Eurozone, and 10 other Organization for Economic Cooperation and Development (OECD) countries over the post-WWII era. Consistent with the analysis of Ball, Mankiw, and Romer (1988) we document a positive correlation between the time-varying aver [...]

2018-04-19

• Redux: Est-ce qu’un pays doit protéger ses industries naissantes pour se développer?
  by Minarchiste in Le Minarchiste, 2018-04-19 23:51:37 UTC

  Notez que cet article fut initialement publié en mars 2013. Est-ce qu’un pays doit protéger ses industries naissantes pour se développer? S’agit-il de la recette magique pour qu’un pays du Tiers-Monde atteigne le statut de pays développé? L’économiste Erik Reinert affirme que oui! Pour Reinert, le développement d’un pays ne résulte pas du laissez-faire et du libre-échange, mais bien de politiques mercantilistes délibérées, incluant le protectionnisme. Voici donc un résumé de la politique de développement prônée par Reinert : Le gouvernement doit avoir une politique industrielle active qui vi [...]

2018-04-18

• A history of randomized assignment in the social sciences
  by Tyler Cowen in Marginal Revolution, 2018-04-18 14:28:39 UTC

  Although the concept of randomized assignment to control for extraneous factors reaches back hundreds of years, the first empirical use appears to have been in an 1835 trial of homeopathic medicine. Throughout the 19th century, there was primarily a growing awareness of the need for careful comparison groups, albeit often without the realization that randomization could be a particularly clean method to achieve that goal. In the second and more crucial phase of this history, four separate but related disciplines introduced randomized control trials within a few years of one another in the 1920 [...]

• The history of randomized control trials: scurvy, poets and beer
  by Markus Goldstein in Development Impact, 2018-04-18 12:55:00 UTC

  The other night I was reading Julian Jamison’s well written and intriguing recent paper : “The Entry of Randomized Assignment into the Social Sciences,” which plumbs history to understand where it is that RCTs come from.      [...]

2018-04-16

• Sam Watson’s journal round-up for 16th April 2018
  by Sam Watson in The Academic Health Economists' Blog, 2018-04-16 13:30:50 UTC

  Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot . If you’d like to write one of our weekly journal round-ups, get in touch . The impact of NHS expenditure on health outcomes in England: alternative approaches to identification in all‐cause and disease specific models of mortality . Health Economics [ PubMed ]  Published 2nd April 2018 [...]

• On the Distribution of Wealth
  by Steve Cecchetti and Kim Schoenholtz in Money, Banking and Financial Markets, 2018-04-16 11:56:16 UTC

  “Both Social Security and Medicare face long-term financing shortfalls under currently scheduled benefits and financing. […] The Trustees recommend that lawmakers take action sooner rather than later to address these shortfalls […to] minimize adverse impacts on vulnerable populations ….” Social Security and Medicare Boards of Trustees, Message to the Public , 2017 Scholars who examine the distribution of income often focus on the issue of poverty. From this perspective, one of the great achievements of our time is the extraordinary reduction of extreme poverty worldwide. In an effort to unders [...]

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