Economic sanctions on trade and financial activities are increasingly being used around the world. This column develops a model of international trade and macroeconomic dynamics to study the effects of sanctions that prohibit trade in certain goods and/or with certain agents. Trade and financial sanctions both lead to lower welfare for the targeted economy, regardless […]
Significant post-pandemic fluctuations in exchange rates and an unusual degree of economic uncertainty have raised the question of how exchange rate movements affect domestic prices in such an environment. Drawing on the experience of a large sample of advanced and emerging market economies over the past 30 years, this column documents that exchange rate pass-through […]
Extreme weather events are bringing devastating consequences for an increasing number of people and countries, so quantifying their economic impact is highly relevant. The effect of changes in climate-related variables on economic output is typically estimated using a ‘damage function’. The methodologies and damage estimates relating to these functions vary a great deal, with each […]
In the next economic downturn, central banks will have to decide whether to restart quantitative easing policies. This column assesses whether central banks may resort to asset purchases in the future and focuses on the signalling channel of transmission. It discusses the underlying mechanisms which support this channel, including showing that monetary policy is not […]
Victor D. Norman, who passed away in September 2024, was a leading figure in international economics. This column outlines the contributions he made to the field through his own research, his leadership in several research projects in Norway and Europe, and the organisation of the most pleasurable conferences and workshops in the profession. Victor Danielsen […]
Many financial institutions have pledged to minimise their exposure to climate transition risks. But moving assets away from sectors with high emissions is sometimes at odds with supporting climate transition investments, as sectors with high emissions – such as utilities and transportation – require capital to invest in greener technologies. This column analyses the tension […]
In Italy, criminal organisations infiltrate municipal bodies to control public resources and manipulate elections. Detecting this infiltration, however, is difficult. This column proposes a machine-learning model that can predict mafia infiltration before it becomes evident and flag ‘high-risk’ municipalities. Policymakers could then monitor high-risk municipalities more closely and implement stronger safeguards to prevent the misuse […]
Education is recognised as a crucial factor in breaking the cycle of poverty. This column examines how historical exposure to colonial public primary schools in Tunisia influences medium- and long-run literacy rates. It finds that increased enrolment of Tunisian students during the colonial period significantly boosted literacy decades later, while the enrolment of European pupils […]
There is a growing friction between state governments and large asset managers over environmental, social, and governance practices. This column investigates whether institutional investors’ voting patterns on socially responsible investing vary according to the political party in control of the state government where a firm is headquartered. It finds that institutional investors are less likely […]
Tensions between fiscal and monetary policies have recently become the focus of macroeconomic policy debates. But by how much have they risen? By introducing a new r-star concept for fiscal policy that can be compared to monetary r-star, this column presents a new framework for measuring fiscal-monetary tensions. Based on 140 years of data for […]
