Bias in evaluating QE
Fabo et al., in this paper, analyze 54 studies looking at the effect of QE on growth and inflation and authored by economists in academia and central banks. They find that on average these studies show that QE has a positive effect on inflation and growth. But they also find that papers written entirely by central bankers found an impact on growth at the peak of QE that was more than 0.7 percentage points higher than the effect estimated in papers written entirely by academics. For inflation, the difference in the effect of QE at its peak between the two sets of papers was more than 1.2 percentage points. They argue that these differences among the two sets of estimates can be attributed to career concerns of central bank researchers. In particular, they find that central bankers who found the largest impact of QE had a better chance of receiving a promotion. The one exception is researchers working at the Bundesbank who found smaller effects on output than academics, in line with the bank’s position.
Fifty Shades of QE: Conflicts of Interest in Economic Research
Authors: Brian Fabo, Martina Jančoková, Elisabeth Kempf, Luboš Pástor
From: National Bank of Slovakia, European Central Bank, University of Chicago, CEPR
Bias in evaluating fiscal multipliers
Can an author’s national background and economic policy orientation, the financial sources funding the research, and career-related publication incentives help explain the size of fiscal multiplier estimates? This is the question that Asatryan et al. are trying to answer. They look at 104 multiplier studies and test for author, funding, and publication biases. They find:
- Researchers from countries with a large government and high level of regulation present larger fiscal multiplier estimates than researchers from countries with a small government and low regulation;
- Government-funded research provides larger fiscal multiplier estimates than non-government-funded research.
Biases in fiscal multiplier estimates
Authors: Zareh Asatryan, Annika Havlik, Friedrich Heinemann, Justus Nove
From: ZEW Mannheim, CESifo, University of Mannheim, University of Heidelberg
