Starting in mid-2021, energy prices soared to unprecedented heights. Initially driven by the global post-pandemic rebound, this was exacerbated by the Russian invasion of Ukraine. This column shows that an energy price shock has a negative effect on individual households and macroeconomic outcomes. Passive monetary policy can mitigate the economic consequences, whereas active policy responses […]
While the financial secrecy of offshore tax havens has historically created ample tax evasion opportunities for wealthy individuals, automatic information exchange between tax authorities is an ambitious attempt to make tax enforcement possible. This column summarises describes how information exchange creates large improvements in tax compliance through repatriation of offshore wealth, self-reporting of offshore financial […]
Critics of foreign aid are often quick to point out the faults of recipient countries. This column looks at the motives of the donor countries themselves. Examining the flow of foreign aid following major discoveries of natural resources, the authors find that aid flows tend to increase following a discovery despite the recipient country becoming […]
Assets prices can amplify economic cycles through their effects on firm investment. Furthermore, these effects vary depending on firm size, with larger firms being better at self-financing investments. This column uses firm-level data from France to show significant heterogeneity by firm size in the sensitivity of investment to real estate prices. Using variation in firm […]
The notion that politicians’ identity, including their gender, can influence policy outcomes is supported by a growing body of empirical research. This column reports a study exploring the extent to which the share of women members in national governments during the Covid-19 pandemic shaped the policy responses. Higher female representation was associated with a lower […]
A large proportion of the financing needs for Europe’s digital, energy, and demographic transitions, as well as defence, will have to be covered by public funding. This column argues that these can all be seen as European public goods, and that a first step towards achieving them should to maximise the capacity of existing instruments, […]
The Middle Ages are widely understood as an era of economic immobility. This column uncovers a more nuanced picture. Wealth transmission in late medieval Florence was characterised by both mobility and persistence. While there was a notable degree of social mobility across adjacent generations, privilege tended to persist over longer horizons. Social and political networks […]
A large share of EU firms experienced supply chain disruptions in recent years. This column shares highlights from the 2024 European Investment Bank report on how to enhance the security and resilience of EU supply chains without sacrificing the benefits of the global production model. The EU internal market appears to work as a buffer […]
As governments increasingly resort to industrial policy to achieve economic and non-economic objectives, the number of subsidies has more than tripled in the last decade. This column investigates the effects of domestic subsidies on trade flows. It shows how these measures can alter comparative advantage patterns and hence affect export dynamics, especially in large emerging […]
While much of the world has benefited from international trade, some regions and individual citizens have been left conspicuously behind. This column summarises analysis from the WTO’s 2024 World Trade Report on the relationship between international trade and inclusiveness. The diverse impact of international trade across economies points more to the inadequacy of domestic policies […]
