Two new papers examine the global fertility decline. The first shows how nearly universal this trend is, with standard economic explanations falling short. The second challenges the usual pessimism: lower birth rates coincide with faster growth in GDP per working-age adult and more labor-saving innovation.

New cross‑country evidence shows that higher immigration inflows raise labor productivity, investment, and TFP in OECD economies, while recent U.S. research finds that post‑pandemic immigration has actively eased low‑skill labor shortages by helping fill vacancies and moderating wage pressures.

Two new working papers show that a surprisingly small set of firms can move the whole business cycle: one via concentrated information attention, the other via concentrated business sentiment. Together, they suggest that who is watched and how firms feel may matter as much as conventional macro shocks in driving aggregate fluctuations.

Two papers from the 2025 RBA Annual Conference examine fiscal-monetary interactions from complementary angles. The first draws on US policy history to argue that coordination alone is not enough. The second uses heterogeneous-agent models to show that fiscal stimulus and interest rate policy are inescapably intertwined, offering fresh insights into the inflation surge of the early 2020s.

In the US the long-run decline in male labor force participation and the steady fall in unemployment are not what they seem as both are heavily shaped by population ageing, rising educational attainment, and cohort-specific behavioral shifts.

Two new studies use innovative measurement approaches to quantify the economic costs of regulation, finding that deregulatory shifts boost investment, productivity, and stock prices in the U.S., while rising compliance burdens across OECD economies are linked to weaker productivity growth and reduced business dynamism.

Two recent working papers challenge conventional measures of neutral monetary conditions, proposing more robust benchmarks that go beyond the standard short-term interest rate . Both reach the same bottom line: traditional r* estimates are too unreliable to serve as the sole guide for assessing whether monetary policy is truly neutral.

This newsletter highlights new evidence on how higher defence spending affects the EU economy. It shows that the growth payoff from rearmament hinges on three choices namely, what Europe buys (capital vs personnel), where it buys (domestic vs imports), and when in the cycle it spends.

Firm survey data from 21,000+ establishments across 15 developing countries reveal widespread underuse of advanced technologies within business functions. A new working paper models how absorptive capacity, institutions, and firm selection sustain these technology gaps behind the frontier, driving cross-country income differences despite equal long-run growth rates.

The US is facing a fiscal crisis, with debt-to-GDP ratios projected to reach 183-233% by 2054 under current policies. While six theoretical paths exist to resolve unsustainable deficits—faster growth, lower rates, default, inflation, financial repression, or austerity—none are politically feasible without a crisis forcing action.