|
on Investment |
| By: | Junhan Lyu; Tianle Zhai; Zicheng Peng; Xuhang Huang |
| Abstract: | This paper examines the impact of increasing minimum wages, focusing primarily on their effect on employment. Our research involved analyzing the statistics of panel data, testing fixed effects and stationary, conducting linear regression, and integrating the linear regression model with nonlinear model analysis. The results indicate that fluctuations in the employment rate are almost entirely explained by the selected explanatory variables, and there is a significant negative correlation between minimum wages and the employment rate. This paper contributes to current research by providing more comprehensive analyses, particularly through the use of nonlinear models, resulting in better-fitting models. We employed multiple fitting methods for time series data and their differentials, combining these results with nonlinear analysis. |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2503.19617 |
| By: | Maximilian J. Blömer; Nicole Guertzgen; Laura Pohlan; Holger Stichnoth; Gerard J. van den Berg |
| Abstract: | We structurally estimate an equilibrium search model using German administrative data and use the model for counterfactual analyses of a uniform minimum wage. The model with worker and firm heterogeneity does not restrict the sign of employment effects a priori; it allows for different job offer arrival rates for the employed and the unemployed and lets firms optimally choose their recruiting intensity. We find that unemployment is a non-monotonic function of the minimum wage level. Effects differ strongly by labor market segment defined by region, skill, and permanent worker ability. |
| Keywords: | monopsony, wages, employment, productivity, structural estimation. |
| JEL: | J31 J38 J42 J64 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ulp:sbbeta:2024-43 |
| By: | König, Jörg; Meyer, Tim |
| Abstract: | Die EZB und die Europäische Kommission treiben die Einführung eines digitalen Euros offensiv voran. Obwohl viele Details zur technischen Ausgestaltung und Funktionalität noch offen sind, wird damit geworben, dass eine digitale Gemeinschaftswährung mit einer Reihe von Vorteilen für Europa verbunden wäre. So soll der digitale Euro zusätzlich zum Bargeld als zweite Form des Zentralbankgeldes für jedermann zur Verfügung stehen, als Innovationstreiber und monetärer Anker dienen, die Abhängigkeit von nicht-europäischen Zahlungsdienstleistern verringern sowie die Souveränität und Autonomie der Eurozone sichern. Bei näherer Betrachtung überwiegen jedoch die Nachteile. Zuvorderst stellt sich die Frage nach dem tatsächlichen Mehrwert einer digitalen Gemeinschaftswährung. Im privaten Bereich sind die angeführten Vorteile angesichts der bereits bestehenden und mit anderen Finanzdienstleistungen kombinierbaren digitalen Zahlungswege wenig überzeugend. Schließlich gehört digitales Bezahlen längst zum Alltag vieler Haushalte, ohne dass es dafür bislang einer staatliche Digitalwährung bedurfte. Gleichzeitig ist mit der digitalen Gemeinschaftswährung die Gefahr verbunden, dass es zu einer schleichenden Abschaffung des Bargelds - Garant von Privatsphäre und Schutz vor Negativzinsen - kommt. Die avisierte Haltegrenze von 3.000 Euro und die Einbeziehung von Finanzintermediären reduziert zudem die Praktikabilität eines digitalen Euro, allerdings wären diese Einschränkungen erforderlich, etwa um das Risiko eines (digitalen) Bank-Runs zu reduzieren. Schließlich ist der ambitionierte Zeitplan von EZB und Europäischer Kommission äußerst riskant, da womöglich vorschnell Fakten geschaffen werden, die im Nachhinein nur schwerlich rückgängig gemacht werden können und im Zweifel das zentrale Subsidiaritätsprinzip der EU sowie das Vertrauen der Bürger in die europäischen Institutionen weiter untergraben. |
| Keywords: | Bargeld, Digitalisierung, Eurozone, EZB, Finanzmärkte, Geldpolitik |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:smwarg:316442 |
| By: | Akbulut-Yuksel, Mevlude (Dalhousie University); Aydemir, Abdurrahman B. (Sabanci University); Kirdar, Murat Güray (Koc University); Turan, Belgi (TOBB University of Economy and Technology) |
| Abstract: | This paper examines the horizontal transmission of gender norms using the forced migration of ethnic Turks from Bulgaria to Türkiye after the fall of the Iron Curtain as a natural experiment. Despite shared linguistic and religious ties, migrant women held more progressive gender norms and stronger labor market attachment than native Turkish women. Their arrival increased labor market participation among native women, particularly in male-dominated manufacturing, while men’s outcomes remained unchanged. Additionally, native women’s fertility declined, and middle school attainment rose, aligning with refugee women’s patterns. Exposure to progressive norms reshaped native women's roles in work and family life. |
| Keywords: | culture, horizontal transmission, social learning, migration |
| JEL: | J16 J15 J13 N45 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17871 |
| By: | Khakimov, Parviz; Diao, Xinshen; Goibov, Manuchehr; Ashurov, Timur |
| Abstract: | The agricultural sector accounted for one-third and one-fourth of total GDP in 2011 in 2022, respectively. In 2022 compared to 2011, both primary and off farm agricultural GDPs dropped, respectively by 13.2 and 3 percentage points, while primary agriculture employment share fell by 10.4 percentage points. The domestic market played a vital role in the recent agrifood system (AFS) growth, and a sizable portion of locally produced agrifood products was able to meet domestic demand. Though agroprocessing an important off-farm component of the AFS, grew more rapidly and thus contributed the most to off farm AFS growth, the aggregate size of off-farm components of the AFS did not increase to match with the structural change in the broader economy. |
| Keywords: | agrifood systems; markets; productivity; value chains; Tajikistan; Asia; Central Asia |
| Date: | 2025–04–25 |
| URL: | https://d.repec.org/n?u=RePEc:fpr:ceaspb:174329 |
| By: | António Afonso; Jorge Braga Ferreira |
| Abstract: | We assess how countries’ fiscal policies during COVID-19 pandemic influenced the effects of the Pandemic Emergency Purchase Programme (PEPP) on sovereign bond Option-Adjusted Spreads. Using a cross-sectional regression model with country and time-fixed effects, we analyse a sample of 1, 368 euro-denominated sovereign bonds issued between Q1:2018 and Q1:2022 in 19 Eurozone countries. We consider the PEPP net purchases by country, and the fiscal policy is measured through changes in debt-to-GDP ratio and net lending/borrowing as a percentage of GDP. The results indicate that PEPP’s effectiveness in reducing spreads was strongly conditional on fiscal conditions, and then fiscal fundamentals condition the effectiveness of ECB interventions. In high-debt countries, PEPP did not lower spreads, which suggests that fiscal concerns remained dominant. PEPP was more effective in low-debt countries, but its effects diminished as the level of debt increased, which suggest rising fiscal risks. Furthermore, eligibility status was more important in economies with low debt levels, where eligible bonds were seen as riskier assets. Finally, the results suggests that PEPP’s effectiveness was stronger for higher-rated bonds, longer-maturity bonds, and central government bonds, in fiscally sound countries. |
| Keywords: | ECB, PEPP, unconventional monetary policy, fiscal policy, sovereign bond yields, Covid-19 pandemic. |
| JEL: | C23 E52 E58 E62 G12 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11864 |
| By: | Kihwan Bae; Morris M. Kleiner; Conor Norris; Edward J. Timmons |
| Abstract: | There is a consensus that there is an earnings premium for licensed workers relative to unlicensed workers. However, little is known about how occupational licensing affects earnings inequality. In this paper, we study dynamic, heterogeneous earnings effects of occupational licensing and draw implications for earnings inequality in the United States. First, we find that the earnings gap between workers in licensed occupations and those in unlicensed occupations with similar characteristics (“licensing premium”) increased slightly during the 1983–2019 period. Second, we find that the licensing premium for workers in high paying occupations significantly increased, which is not the case for workers in lower paying occupations. The finding is consistent with growing demands for skills over the past decades, given the more rigorous licensing requirements for high-skilled occupations. As a result, earnings inequality among workers in licensed occupations increased. Third, we document that the licensing premium for female workers and workers without a college education declined relative to male workers and college graduates. Taken together, our findings suggest that occupational licensing is associated with widening earnings inequality in the United States during the 1983–2019 period. |
| JEL: | J31 J44 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33732 |
| By: | Alexeev, Michael (Indiana University); Chernina, Yevgenia (New Uzbekistan University); Gimpelson, Vladimir (University of Wisconsin-Madison); Zinchenko, Darya (Higher School of Economics (HSE)) |
| Abstract: | We compare wage profiles for STEM-educated and non-STEM-educated individuals over their lifetimes. Using repeated cross-sectional data from Russia, we examine how the dynamics of these types of human capital are affected by technological developments, applying the Age-Period-Cohort decomposition to workers’ life cycle wage growth. Additionally, we account for heterogeneity in the impact of institutional quality on lifetime wage profiles. We show that STEM education is associated with flatter wage-experience profiles than non-STEM education, with the most pronounced differences observed among females. The cohort effect, apparently specific to the former Soviet-type economies, reveals itself in devaluing some types of older education, putting non-STEM cohorts educated during the Soviet period at a disadvantage relative to those with STEM education. Importantly, in the Russian case, the age/experience effects act in the direction opposite to the cohort effects, rendering the cross-sectional analysis somewhat misleading. Finally, wage-experience profiles for males with non-STEM education are steeper in regions with weak institutions than in regions with stronger institutions. |
| Keywords: | age-period-cohort decomposition, life-cycle wage growth, wage, human capital, STEM, Russia |
| JEL: | E24 J24 J31 O33 O43 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17875 |
| By: | Andrew F. Haughwout; Donghoon Lee; Daniel Mangrum; Joelle Scally; Wilbert Van der Klaauw |
| Abstract: | This morning, the Center for Microeconomic Data at the New York Fed released the Quarterly Report on Household Debt and Credit updated through the first quarter of 2025. Over the first quarter, overall household debt rose by $167 billion. An increase of $199 billion in mortgage balances and modest increases in home equity lines of credit (HELOC) and student loans were offset by declines in auto loans and credit card debt of $13 billion and $29 billion, respectively. The decline in credit card balances is a typical seasonal pattern associated with consumers paying down holiday spending from the fourth quarter, but the auto loan decline was atypical, the first such decline since the third quarter of 2020. The rates at which auto loans and credit cards became seriously delinquent improved slightly, while mortgage and HELOC transition rates edged up but remained low. However, the delinquency rate for student loans stands out: it surged from below 1 percent to nearly 8 percent, as the pause on reporting delinquent federal student loans ended. In this post, we focus on student loan delinquency, including which borrowers are past due and what it might mean for their access to credit. |
| Keywords: | household debt |
| JEL: | G51 |
| Date: | 2025–05–13 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fednls:99962 |
| By: | Masamune Iwasawa |
| Abstract: | Parameter estimation can result in substantial mean squared error (MSE), even when consistent estimators are used and the sample size is large. This paper addresses the longstanding statistical challenge of analyzing the bias and MSE of ridge-type estimators in nonlinear models, including duration, Poisson, and multinomial choice models, where theoretical results have been scarce. Employing a finite-sample approximation technique developed in the econometrics literature, this study derives new theoretical results showing that the generalized ridge maximum likelihood estimator (MLE) achieves lower finite-sample MSE than the conventional MLE across a broad class of nonlinear models. Importantly, the analysis extends beyond parameter estimation to model-based prediction, demonstrating that the generalized ridge estimator improves predictive accuracy relative to the generic MLE for sufficiently small penalty terms, regardless of the validity of the incorporated hypotheses. Extensive simulation studies and an empirical application involving the estimation of marginal mean and quantile treatment effects further support the superior performance and practical applicability of the proposed method. |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2504.19018 |
| By: | Chusseau Elsa (CREAD EA 3875 - Centre de Recherche sur l'Education, les apprentissages et la didactique - UBO - Université de Brest - UR2 - Université de Rennes 2 - IBSHS - Institut Brestois des Sciences de l'Homme et de la Société - UBO - Université de Brest); Crosse Maëlle (MICA - Médiation, Information, Communication, Art - UBM - Université Bordeaux Montaigne); Clavel Anna (IFÉ - Institut français de l'Education - ENS de Lyon - École normale supérieure de Lyon - Université de Lyon); Guichon Valerie (USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc); Hoarau Celine (UM - Le Mans Université); Lidolf Sylvie (Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar); Stratulat Melania (UR2 - Université de Rennes 2); Benech Pierre (IFÉ - Institut français de l'Education - ENS de Lyon - École normale supérieure de Lyon - Université de Lyon) |
| Abstract: | The proposed workshop has arisen from the sharing of feedback by practitioners from five higher education establishments. The aim of these exchanges was to lead a collective reflection, based on a link between research and practice, on the support for change, as part of the management of structuring educational transformation projects. One of the conclusions was that, in order to move from individual initiatives to sustainable transformation, these projects should lead to the development of ‘educational ecosystems'. However, this intention seems to be relatively absent from institutionnal strategies and those of university pedagogical departments. The aim of the workshop is therefore to contribute to the development of these ecosystems by encouraging participants to reflect on their own positions, based on the principles of an enabling organization (Véro & Zimmermann, 2018) and Engeström's third-generation theory of historical-cultural activity (1987). Using a participative and immersive approach, the workshop is built around a case study that examines real-life work situations in a pedagogical transformation project, and around a roleplaying game. |
| Abstract: | L'atelier proposé est né d'un partage de retours d'expérience réalisé par des praticiens de cinq établissements d'enseignement supérieur. Ces échanges avaient pour but de mener une réflexion collective, en appui sur une articulation de la recherche et des pratiques, autour de l'accompagnement du changement, dans le cadre de la conduite de projets structurants de transformations pédagogiques. Il en est ressorti notamment que pour passer d'initiatives individuelles à une transformation durable, ces projets devraient conduire au développement « d'écosystèmes pédagogiques ». Pour autant, cette intention semble relativement absente des stratégies d'établissements et de celles des services universitaires de pédagogie. Ainsi, l'atelier vise à contribuer au développement de ces écosystèmes en suscitant chez les participants, une réflexivité sur leur posture, en appui sur les principes d'une organisation capacitante (Véro & Zimmermann, 2018) et sur la théorie de l'activité historico-culturelle de troisième génération d'Engeström (1987). Inscrit dans une approche participative et immersive, l'atelier est construit autour d'une étude de cas qui interroge des situations de travail réelles dans un projet de transformation pédagogique et autour d'un jeu de rôle. |
| Keywords: | activity system, ecosystem, pedagogical transformation, Enabling organization, collaboration, Organisation capacitante, système d'activité, écosystème, transformation pédagogique |
| Date: | 2025–04–07 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05035092 |
| By: | Salma Zouaoui; Ioana Filipas; Punita Raj; François Marmier; Bertrand Rose |
| Abstract: | This study investigates the barriers to Digital Transformation (DT) in French service SMEs. As literature on DT of service SMEs is scarce, this study uses a combination of a literature review analysis of barriers to DT in SMEs and a thematic analysis of the challenges to DT encountered by 26 service SMEs. The research identifies six main categories of barriers: technological barriers, business and strategic barriers, process and operational barriers, organizational barriers, human and talent barriers and security and compliance barriers. This paper highlights that service SMEs highly underestimate the barriers related to human and talent barriers and slightly underestimate organizational barriers while overestimating business and strategic barriers. This paper emphasizes the inadequacy of existing DT strategies designed for larger corporations and raises the need for research in the DT of service sector and particularly of service SMEs. The study also discusses the potential biases inherent in the data collection from reports intended for tax administration and the limitations of the sample size. |
| Keywords: | barrier, challenge, digital transformation, qualitative analysis, Small and Medium-sized Enterprises, thematic analysis. |
| JEL: | L8 L80 O3 O30 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ulp:sbbeta:2024-49 |
| By: | Rehm, Miriam |
| Abstract: | Österreich befindet sich, wie Deutschland und andere europäische Länder, derzeit in einer Rezession, für die starke Risiken einer Verlängerung bestehen. Die Forschung zeigt, dass unter solchen Umständen Budgetkonsolidierungen deutlich schwieriger erfolgreich durchzuführen sind, insbesondere wenn diese ausgabenseitig stattfinden (Jordá/Taylor 2016, Gechert 2023), und dass diese zugleich besonders negative Verteilungswirkungen aufweisen (Woo et al. 2016). Diese treffen auf eine ohnehin schon hohe Ungleichheit insbesondere bei Vermögen (Rehm 2020); zudem geht Einkommensungleichheit mit vielfältigen Fehlentwicklungen auf gesamtwirtschaftlicher und gesellschaftlicher Ebene einher (SVR 2024). Daher wäre der grundlegende Konsens in der österreichischen wirtschaftspolitischen Debatte, nämlich dass eine Budgetkonsolidierung zum jetzigen Zeitpunkt ökonomisch sinnvoll ist, aus wissenschaftlicher Perspektive zu hinterfragen. Wird diese Entscheidung der Bundesregierung jedoch als gegeben hingenommen, so weist die Forschung darauf hin, dass Budgetkonsolidierungen während eines wirtschaftlichen Abschwungs, die einnahmenseitig erfolgen und Verteilungsaspekte berücksichtigen, erfolgsversprechender sind als solche, die das nicht tun (Gechert/Rannenberg 2018). Dieser Umstand ist in den Wirtschaftswissenschaften seit Haavelmo bekannt (Haavelmo 1945). Die intuitive Erklärung ist, dass Konsolidierungen, die vorrangig auf das Leistungsfähigkeitsprinzip abstellen, das Wachstum weniger stark beeinträchtigen, weil sie den privaten Konsum - die größte und somit zentrale Nachfragegröße - stabilisieren. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifsoex:317791 |
| By: | Irigoin, Alejandra; Kobayashi, Atsushi; Chilosi, David |
| Abstract: | This paper analyses a new, large dataset of silver prices, as well as silver and merchandise trade flows in and out of China in the crucial decades of the mid-19th century when the Empire was opened to world trade. Silver flows were associated with the interaction between heterogenous monetary preferences and availability of specific coins. Before the 1850s, money markets became increasingly efficient, as reliance on bills of exchange allowed exports to grow in times when sound money was in short supply. When a new standard for silver eventually emerged, there was a new peak in China’s silver imports. |
| Keywords: | China silver flows; triangular trade settlement mechanism; exchange operations; arbitrage; ‘opening of China’ |
| JEL: | E42 F33 N10 |
| Date: | 2023–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:119759 |
| By: | Andrian, Leandro Gaston; Leon-Diaz, John; Rojas, Eugenio |
| Abstract: | We examine hedging as a macroprudential tool in a Sudden Stops model of an economy exposed to commodity price fluctuations. We find that hedging commodity revenues yields significant welfare gains by stabilizing public expenditure, which heavily depends on these revenues. However, this added stability weakens precautionary motives and exacerbates the pecuniary externality that drives overborrowing in such models. As a result, hedging and traditional macroprudential policy act as complements rather than substitutes, with more ag- gressive hedging inducing a stronger macroprudential response. Our findings suggest that while hedging enhances stability and improves welfare, it does not eliminate the need for macroprudential regulation. |
| Keywords: | Hedging;Sudden stops;Financial Crises;Macroprudential policy |
| JEL: | F32 F41 G13 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:idb:brikps:14083 |
| By: | Hern\'an Larralde; Roberto Mota Navarro |
| Abstract: | We show that assuming that the returns are independent when conditioned on the value of their variance (volatility), which itself varies in time randomly, then the distribution of returns is well described by the statistics of the sum of conditionally independent random variables. In particular, we show that the distribution of returns can be cast in a simple scaling form, and that its functional form is directly related to the distribution of the volatilities. This approach explains the presence of power-law tails in the returns as a direct consequence of the presence of a power law tail in the distribution of volatilities. It also provides the form of the distribution of Bitcoin returns, which behaves as a stretched exponential, as a consequence of the fact that the Bitcoin volatilities distribution is also closely described by a stretched exponential. We test our predictions with data from the S\&P 500 index, Apple and Paramount stocks; and Bitcoin. |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2504.20488 |
| By: | Julien Champagne; Antoine Poulin-Moore; Mallory Long |
| Abstract: | We document recent changes in Canadian immigration, marked by an increasing prevalence of temporary residency. Using microdata from Statistics Canada's Labour Force Survey, we show that temporary workers' characteristics and nominal wages have diverged from those of Canadian-born workers. Between 2015 and 2024, temporary workers have become younger, less experienced and more likely to migrate from lower-income countries. As well, the shares of temporary workers in skilled occupations have declined moderately. Throughout this period, the average nominal wage gap between temporary and Canadian-born workers has more than doubled, widening from -9.5% to -22.6%. Further, we estimate Mincer regressions to assess how these evolving characteristics have contributed to the growing wage gap. Our findings show that this increase can be explained by observable characteristics. Our results suggest that aggregate nominal wages would have been, on average, 0.7% higher in 2023–24 had the characteristics of temporary workers remained unchanged over the past decade. |
| Keywords: | Labour markets; Productivity |
| JEL: | J20 J24 J61 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:bca:bocadp:25-08 |
| By: | Roy, Tirthankar |
| Abstract: | The economic emergence of societies in arid and semi-arid tropical regions depended on their ability to extract and recycle water and manipulate the environment for this purpose. India is a prominent example of this process. This pathway to economic growth has significant political and environmental costs. In light of climate change, a key question for the future is: Is tropical development sustainable in this way? The paper answers by drawing on the economic history of the tropical arid regions and a recent literature on climate impact on water resources. |
| JEL: | N50 N55 O13 Q56 |
| Date: | 2024–10–07 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:125641 |
| By: | Banerjee, Sumanta; Mohapatra, Souryabrata |
| Abstract: | Adaptation measures are crucial tools in combating the adverse effects of climate change. Assessing the progress of adaptation efforts in developing countries like India, particularly in disaster-prone states like Odisha, is of utmost importance. This study explores how adaptation initiatives help to reduce vulnerability, mitigate disaster risks, and enhance socio-ecological resilience. Utilizing insights from the Sustainable Livelihood Framework, Sendai Framework, and Millennium Ecosystem Assessment, we identify various adaptation strategies and compile an inventory. This inventory is derived from diverse sources, including peer-reviewed literature, gray literature, and documents from International Non-Governmental Organizations (INGOs) and state-level Non-Governmental Organizations (NGOs). The key results from the inventory indicate that the government is the leading adaptation provider, followed by the interventions of the INGOs and NGOs. It is observed from the qualitative data analysis that 35 percent of the adaptation reduces disaster risk, 45 percent of the activities/interventions help in reducing vulnerability, and 20 percent of the interventions promote and strengthen ecological resilience building. The research is limited by the fact that the adaptation inventory created is not a comprehensive list of adaptation interventions but rather an indicative one. It does not consider autonomous or household-level adaptations. Additionally, it offers for expanding successful adaptation interventions from local to regional or national levels, as demonstrated by experiences in Coastal Odisha, which can be applied to broader geographical areas. |
| Keywords: | Climate Adaptation, Disaster Risk Reduction, Socio-Ecological Resilience, Coastal India |
| JEL: | H84 Q54 R58 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:124193 |
| By: | Nicolas de Roux; Laurent Ferrara |
| Abstract: | Officially, the U.S. Federal Reserve has a statutory dual domestic mandate of price stability and full employment, but, in this paper, we question the role of the international environment in shaping Fed monetary policy decisions. In this respect, we use minutes of the Federal Open Market Committee (FOMC) and construct indexes of the attention paid by U.S. monetary policymakers to the international economic and financial situation. These indexes are built by applying natural language processing (NLP) techniques ranging from word count to built-from-scratch machine learning models, to OpenAI's GPT models. By integrating those text-based indicators into a Taylor rule, we derive various quantitative measures of the external influences on Fed decisions. Our results show that when there is a focus on international topics within the FOMC, the Fed’s monetary policy generally tends to be more accommodative than expected by a standard Taylor rule. This result is robust to various alternatives that includes a time-varying neutral interest rate or a shadow central bank interest rate. |
| Keywords: | Monetary policy, Federal Reserve, FOMC minutes, International environment, Natural Language Processing, Machine Learning |
| JEL: | E52 F42 C54 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:drm:wpaper:2025-23 |
| By: | Josten, Cecily; Lordan, Grace |
| Abstract: | Introduction: Collaboration and inclusion are key drivers of successful work outcomes in today’s increasingly diverse workforce. Yet, while organizational inclusion has been widely studied, less is known about what makes an individual inclusive of others at work. We define an inclusive individual as someone who actively includes others in a group, values diversity of thought and background, and fosters group performance and productivity. To address this gap, we develop and validate a new measure: the Individual Inclusiveness Inventory. Methods: Using a combined deductive and inductive approach, we generated scale items based on a review of the inclusion literature and qualitative interviews with 14 diversity and inclusion experts. We conducted exploratory factor analysis (EFA) followed by confirmatory factor analysis (CFA) on responses from two samples of working professionals in the UK. Results: The analyses revealed a two-factor solution. The first factor, Belonging and Uniqueness, captures the ability to foster a sense of belonging while valuing individuals’ distinctiveness. The second factor, Challenge and Openness, reflects openness to diverse perspectives and willingness to engage in and accept constructive challenge. Both factors demonstrated good reliability. Predictive validity analyses showed that Challenge and Openness was positively associated with all measured work outcomes, including income. Belonging and Uniqueness was positively associated with the number of people managed, perceived seniority, and happiness at work. Discussion: Our findings suggest that individual inclusiveness is multi-dimensional and differentially predictive of work outcomes. Challenge and Openness appears closely linked to productivityrelated outcomes, likely due to its association with innovation and competitiveness. Belonging and Uniqueness, while less predictive of productivity, is important for relational outcomes such as team cohesion and well-being. These insights have implications for talent development and inclusive leadership training. |
| Keywords: | inclusion; inclusiveness; personality; scale development; factor analysis; REF fund |
| JEL: | R14 J01 |
| Date: | 2025–05–07 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127800 |
| By: | Eren Gürer; Alfons Weichenrieder |
| Abstract: | This study examines optimal government redistribution in a Mirrleesian framework, accounting for a negative effect of longer working hours on productivity. A government ignoring this effect perceives labor supply as insufficient and sets lower marginal income taxes to encourage work. In contrast, a government recognizing the endogenous relationship between productivity and labor supply redistributes more. However, the resulting marginal taxes are still lower than those predicted by standard models where productivity is independent of working hours. |
| Keywords: | working hours, productivity, optimal redistribution, self-confirming policy equilibrium. |
| JEL: | H21 H31 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11866 |
| By: | Rodolfo E. Manuelli |
| Abstract: | In their celebrated 1981 paper "Some Unpleasant Monetarist Arithmetic, " Sargent and Wallace show that when a central bank is required to transfer resources to the fiscal authority, it faces a trade-off: if it chooses to keep inflation low in the short run, then it must be willing to accept higher inflation in the long run. In this paper I characterize the optimal interest rate (and inflation) policy by a central bank faced with a version of the Sargent-Wallace scenario. I explore this question in a setting in which a certain amount has to be transferred for an uncertain period of time. I find that uncertainty makes the optimal policy to deviate from a Barro-like martingale behavior of taxes or a Lucas-Stokey type of solution where the tax (or distortion) inherits the properties of the stochastic process for transfers. The optimal nominal interest rate (and inflation) is such that the central bank chooses to issue debt (e.g., reverse repos) instead of raising the required amount of seigniorage. Initially inflation is lower than what would be required to raise enough resources to pay for the transfer plus the interest on existing debt. The intuition for this result is that the monetary authority is taking advantage of an option: if the transfer period is short, then (relatively) low inflation today can spread the losses over time. Over time, as the debt increases, more revenue has to be raised. Interest rates increase. The time path of inflation depends on whether the monetary authority can “inflate away” part of the debt. If this default is costly, the end of the transfer period is associated with permanently lower inflation. If a sudden increase in the price level (default) is an option (and if it chooses to be exercised), the end of the transfer period is associated with high (and brief) inflation and then stabilization. |
| Keywords: | optimal monetary policy; inflation; fiscal dominance |
| JEL: | E5 E6 |
| Date: | 2025–04–02 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedlwp:99980 |