Tag Archives: Notes

In a CEPR Discussion Paper, Sascha Becker, Thiemo Fetzer, and Dennis Novy argue that education and income mainly explain voting outcomes. In the abstract of their paper, the authors write: We find that exposure to the EU in terms of immigration and trade provides relatively little explanatory power for the referendum vote. Instead, … fundamental characteristics of the voting population were key drivers of the Vote Leave share, in particular their education profiles, their historical...

In the FT blog, Peter Doyle emphasizes the importance of independent fiscal watchdogs. They matter. That’s why less autocratic governments pursuing competent policies support them (and others don’t). It would be useful to have independent fiscal institutions and policy watchdogs on a supranational level.

In December 2016, the Swiss Federal Council concluded that in international comparison, government support for the Swiss agricultural sector is very high. But critics point out that the government report might understate the social cost of government support. In a separate study the lobby group `Vision Landwirtschaft’ had presented estimates according to which the Swiss agricultural sector adds negative value, on the order of 1 billion CHF per year. NZZ reports by Désirée Föry: February...

In a recent Citigroup Global Economics View Research report, Willem Buiter discusses “Bad and Good ‘Fiscal Theories of the Price Level’.” Quoting my own work on the Fiscal Theory, Buiter warns that policy makers start to pay attention to the theory: It does not often happen that a rather obscure technical bit of economic theory merits an audience wider than the small band of academics who spend their waking hours pondering such matters because that is the kind of thing they do. This note...

The Mexican Peso has been recovering ever since Donald Trump assumed office. Its value has climbed back to nearly where it was at the time of the US election. Time series as reported by xe.

In an open letter, L. Rafael Reif, President of MIT, encourages Americans to oppose the White House’s budget plans.

On his blog, JP Koning discusses the case of Somalia which has managed without central bank issued money for decades. Old, legitimate notes and newer, counterfeit notes trade at the same price which equals the cost of producing counterfeits. See also this previous post.

In a CEPR discussion paper, Òscar Jordà, Björn Richter, Moritz Schularick, and Alan M. Taylor suggest that higher bank capital ratios help stabilize the financial system ex post but not ex ante, and that illiquidity breeds fragility. Abstract of their paper: Higher capital ratios are unlikely to prevent a financial crisis. This is empirically true both for the entire history of advanced economies between 1870 and 2013 and for the post-WW2 period, and holds both within and between...

The Economist reports that forthcoming European payments regulation has the potential to disrupt the industry. Provided the customer has given explicit consent, banks will be forced to share customer-account information with licensed financial-services providers. … payment services … could become more integrated into the internet-browsing experience … With access to account data … fintech firms could offer customers budgeting advice, or guide them towards higher-interest savings accounts...

On the Liberty Street Economics blog, Catherine Chen, Marco Cipriani, Gabriele La Spada, Philip Mulder, and Neha Shah discuss last year’s regulatory changes regarding money market mutual funds: First, institutional prime and muni funds—but not retail or government funds—must now compute their net asset values (NAVs) using market-based factors, thereby abandoning the fixed NAV that had been a hallmark of the MMF industry. Second, all prime and muni funds must adopt a system of gates and...