Research
ECB paper quantifies OMT benefits
OMT announcements depressed Italian and Spanish two-year government bond yields by roughly 200 basis points, but left their French and German equivalents ‘largely unaffected’
Adjusted calculation of US employment-to-population ratio signals return to pre-crisis level
Atlanta Fed paper uses micro-data to account for individual characteristics and probability of labour force participation; finds ratio has regained pre-recession level of nearly 63%
ECB economists find ‘considerable heterogeneity’ in impact of crisis
Researchers say that while borrowers ‘benefited’ from low interest rates, debt burdens increased for poor households as their incomes fell
Polish paper proposes new model for risk of ‘double default' on collateralised loans
Commonly used Gaussian copula-based approach does not properly capture the residual risk to central bank balance sheets posed by correlated defaults
Better budgeting tools could encourage low earners to switch from cash to card
Researchers find that low earners prefer to use cash over the debit card because they find it more effective as a monitoring and budgeting tool
BoE working group finds ‘striking' changes in investment behaviour by insurers and pension funds
Nature of investments has changed markedly over the past 15 years, says Andrew Haldane-led group, which also includes Oxford professor Ian Goldin and Jim O'Neill
BIS paper with New York Fed unveils new measure of underlying inflation
Economists from the Bank for International Settlements and Federal Reserve Bank of New York present a new measure that can be updated on a daily basis
Preferential treatment distorts banks' demand for government bonds
Transaction-level data suggests comparatively beneficial liquidity and capital regulation is incentivising banks to swap other bonds for sovereign debt
Spanish economists see short-run benefits in structural reforms
Working paper published by Bank of Spain says product and labour market reforms could boost output and employment now and in the future
Cross-border vulnerabilities should be taken more seriously, IMF paper says
Working paper says funding vulnerabilities ‘have real effects', although they have declined since the crisis due to lower exposures and increased capital levels
Herding tendencies mean smaller banks won't solve moral hazard issue
Anticipation of bailouts encourages banks to invest alike, making bailouts more probable and crises more severe, Minneapolis Fed paper argues
‘Shadow' Fed funds rate suggests Fed should have loosened more following crisis
Kansas City Fed study says Fed should have been more active in early stage of ‘Great Recession' but also notes policy became ‘considerably' more accommodative over time
IMF paper finds macro-prudential polices can help prevent liquidity traps
Researchers find that debt limits and insurance requirements can help prevent economic agents from accumulating excessive leverage and triggering liquidity traps
French paper warns buffers ‘may not be sufficient’ to avoid credit crunch
Banque de France working paper finds an increase in market pressure to hold more capital can ‘limit the ability of banks to expand credit’ and trigger a crisis
IMF paper attempts to pin down output gap
Members of the Fund's European department build new models incorporating financial frictions to estimate the output gap in the US during the Great Moderation and beyond
ECB paper finds rich to be richer than previously thought
ECB working paper uses rich lists to estimate wealth concentration, overcoming 'differential non-response' problems; finds wealth even more concentrated than traditional surveys show
IMF economist analyses effect of floods and storms on Caribbean debt-to-GDP
Both storms and floods have a negative effect on growth, IMF economist finds, but only floods affect debt in the natural disaster-hit region
Effective oversight needed to consolidate gains from mobile payments infrastructure
Increased diffusion of mobile payments in developing countries calls for better oversight, IMF paper says - recommending that central banks cooperate with other regulators
Australians might be better off renting, paper finds
If people expect house price growth to slow relative to the past 60 years, they might be better off renting, according to a paper published by the Reserve Bank of Australia
Spanish economists devise system for detecting risks to budget forecasts
Working paper published by the Bank of Spain presents a new ‘toolkit’ to monitor the government budget in real time; authors say it will help protect state’s reputation
Academics in charge make companies better off, Bank of Finland paper finds
Discussion paper finds that firms benefit from having academic directors, who are associated with improved acquisition performance and higher numbers of patents
Forecasting of ECB and New York Fed became ‘noticeably worse’ during crisis
Researchers at the ECB and New York Fed examined forecasting performance of their central banks; finding they suffered during the crisis, but not more than external parties
ECB finds Phillips curve 'insufficient’ to forecast inflation
Article in latest ECB monthly bulletin finds evidence of a ‘curve-type relationship’ between inflation and economic slack, but the specification is ‘subject to considerable uncertainty’
IMF paper examines banks’ public bond holdings
Working paper published by the IMF finds that large banks accumulate high-risk public bonds during sovereign crises; examines relationship with bank lending