Archive
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Distortions and policy instruments
Olivier Blanchard and Troy Daviga and Refet S. Gürkaynak on how the macro models that focus on “one distortion and one instrument” have lead to sub-optimal policies.
The start of Brexit negotiations
Kirkegaard on the importance of a strong Franco-German axis. Mayer and al. on the welfare gains from EU integration and welfare losses from Brexit and Schoenmaker’s detailed analysis of passporting rights.
Monetary policy and the financial sector
How low can interest rates go before hurting the economy? Two new working papers on financial intermediaries and their impact on the transmission of monetary policy.
Rethinking the inflation target
US economists write to Janet Yellen recommending an increase of the Fed’s inflation target. Not everyone is on board though!
The German trade surplus
Is Germany’s trade surplus hurting the US? New research on whether wage or expansionary fiscal policy could reduce the German trade surplus.
Uncertainty
What explains the disconnect between political uncertainty and stock market volatility in the US. Are we on the cups of a correction or a boom? Hansen and Sargent’s new paper on uncertainty and tenuous beliefs.
The economics of climate change
How QE has favored the high-carbon sector and why the US has been caught in a cycle of extreme shifts in climate policy since the 1970s.
New and noteworthy books in economics (June)
Three notable new books: on technology and labor market, finance and auctions.
Changing patterns in capital flows
How capital flows have changed after the Global financial crisis. What are the global risks from the expansion of FDI outflows from emerging markets.