Search

Copyright of Ictimaiyat is the property of Ictimaiyat and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Using a panel of macroeconomic data for Canada and its 10 provinces, we estimate the dynamic effects of monetary policy shocks from the mid‐1980s until the present. We then relate the change in the impact of these shocks to macroeconomic factors including demographics, specifically changes in the old age dependency ratio. We find that the inflation‐targeting regime has had an ambiguous effect on the impact of monetary policy shocks in Canada. On the other hand, changing demographics have unambiguously reduced the impact of monetary policy shocks. This can help to explain tepid inflation since the financial crisis and could eventually undermine the effectiveness of Canada's inflation targeting regime. [ABSTRACT FROM AUTHOR]

Summary: We propose a nonrecursive identification scheme for uncertainty shocks that exploits breaks in the volatility of macroeconomic variables and is novel in the literature on uncertainty. This approach allows us to simultaneously address two major questions in the empirical literature: Is uncertainty a cause or effect of decline in economic activity? Does the relationship between uncertainty and economic activity change across macroeconomic regimes? Results based on a small‐scale vector autoregression with US monthly data suggest that (i) uncertainty is an exogenous source of decline of economic activity, and (ii) the effects of uncertainty shocks amplify in periods of economic and financial turmoil. [ABSTRACT FROM AUTHOR]

This paper examines the resilience of households in Vanuatu and Solomon Islands—two small island developing states in Melanesia renowned for their vulnerabilities—to the adverse effects of global macroeconomic shocks. The focus is on the spike in international food and fuel prices in 2008 and the subsequent shock to global demand, known as the Global Economic Crisis (GEC). Using a unique retrospective cross‐section survey, the results show that experience of these shocks was widespread across urban and rural areas. Households with more education, access to income‐generating activities—particularly in the informal sector—and greater wealth were best placed to withstand a deterioration in their well‐being, measured as a fall in self‐reported disposable income. Households also employed a variety of coping strategies in response to the shocks. Local food gardens and informal insurance are seen as key safety nets in times of stress, yet neither provided full insurance from the shocks. Some households, particularly in urban areas, employed harmful coping strategies, such as reducing spending on health, education, and food. While potentially effective in withstanding a temporary fall in disposable income, these responses are likely to weaken overall resilience and leave households vulnerable to future shocks. [ABSTRACT FROM AUTHOR]

This article investigates if the impact of uncertainty shocks on the U.S. economy has changed over time. To this end, we develop an extended factor augmented vector autoregression (VAR) model that simultaneously allows the estimation of a measure of uncertainty and its time-varying impact on a range of variables. We find that the impact of uncertainty shocks on real activity and financial variables has declined systematically over time. In contrast, the response of inflation and the short-term interest rate to this shock has remained fairly stable. Simulations from a nonlinear dynamic stochastic general equilibrium (DSGE) model suggest that these empirical results are consistent with an increase in the monetary authorities’ antiinflation stance and a “flattening” of the Phillips curve. Supplementary materials for this article are available online. [ABSTRACT FROM AUTHOR]

We estimate a number of macroeconomic variables as logistic smooth transition autoregressive (LSTAR) processes with uncertainty as the transition variable. The notion is that the effects of increases in uncertainty should not be symmetrical with the effects of decreases in uncertainty. Nonlinear estimation allows us to answer several interesting questions left unanswered by a linear model. For a number of important macroeconomic variables, we show that (i) a positive shock to uncertainty has a greater effect than a negative shock and (ii) the effect of the uncertainty shock is highly dependent on the state of the economy. Hence, the usual linear estimates for the consequences of uncertainty are underestimated in circumstances such as the recent financial crisis. [ABSTRACT FROM AUTHOR]

We propose a novel method for econometric time series analysis. This method acts as the comovement-selective filter and is useful to filter out the cycles that are caused by an global event present in the reference time series. We demonstrate its applicability on removing symmetric macroeconomic shock caused by recent financial crisis from the business cycle of the euro area according to the comovement with the United States. The application allowing to identify the country specific business cycles in the Visegrad countries data using the comovement with Germany is also presented. The method is based on the continuous wavelet transform, its inverse and the comovement measurement in the time-frequency domain. Its application also enables to uncover detailed development of the business cycle synchronization in time. [ABSTRACT FROM AUTHOR]

The current economic crisis teaches us a very important lesson. In periods of economic boom, it is indicated that the economic policies to be more cautious to prevent the accumulation of imbalances and to ensure the safety margins that would allow an appropriate response in cases of large unfavorable shocks. The significant role of fiscal policy in macroeconomic policies is already known. It must be brought into account the fact that fiscal policy has a limited space for maneuver, in the sense of working as a stabilizer, being limited by budget deficit threshold. [ABSTRACT FROM AUTHOR]

Front-loaded fiscal austerity since the 2008 financial crisis has meant that the UK economic experience is being viewed as a kind of test case for the proposition that contractionary fiscal policy can induce an economic expansion. The discussion has often been implicitly framed in terms of the size of the potential multiplier. Contributing to the debate, this article provides empirical estimates on the size of fiscal multipliers in the UK across various macroeconomic states during the last 50 years. The results show that since the 1980s positive government spending shocks have had a positive effect on output, with a short-run multiplier value around unity since early 2000. There is also little evidence of private consumption being crowded out. The results imply that recessions could be further aggravated if the government retrenches spending in the midst of the downturn. (JEL codes: E52, E62, F41) [ABSTRACT FROM AUTHOR]

This paper addresses the issue of macroeconomic policies in a financially heterogeneous monetary union. Optimized policy rules are used, under various budgetary policy scenarios, in a two-country DSGE model. The results indicate that a Euro-wide monetary policy strategy based on national information does not offset the costs associated with the abandonment of national monetary policy. Decentralized budgetary policies need to be more proactive in countries which are structurally more sensitive to shocks. For independent common monetary policy, cooperation between governments is comparable to a coalition, causing losses for every member. Welfare improvement at the union level only results from reducing public expenditure divergences. [ABSTRACT FROM AUTHOR]

This paper applies a factor-augmented vector autoregressive model to U.S. data with the aim of analyzing monetary transmission via private sector balance sheets, credit risk spreads, and house prices and of exploring the role of monetary policy in the housing and credit boom prior to the global financial crisis. We find that monetary policy shocks have a persistent effect on house prices, real estate wealth, and private sector debt and a strong short-lived effect on risk spreads in money and mortgage markets. Moreover, the results suggest that monetary policy contributed considerably to the unsustainable precrisis developments in housing and credit markets. Although monetary policy shocks contributed discernibly at a late stage of the boom, feedback effects of other (macroeconomic and financial) shocks via lower policy rates kicked in earlier and appear to have been considerable. [ABSTRACT FROM AUTHOR]

Negative macroeconomic performance issues represent one of the key effects of crisis period. Due to many economic crisis related side effects countries became more vulnerable to various types of endogenous and exogenous shocks. Exchange rates of the European transition economies became much more volatile as a result of increased uncertainty on the financial markets as well as changed behaviour of structural shocks affecting exchange rates path during the crisis period. As a result we expect a contribution of the structural shocks to the exchange rates path has changed. In the paper we analyse sources of exchange rate fluctuations in the European transition economies. We estimate the contribution of nominal, supply and demand shocks to NEER and REER variability implementing SVAR methodology. Long run restrictions are applied to unrestricted VAR model to identify structural shocks. Variance decomposition and impulse-response functions are computed for each individual country for the period 2000-2007 and 2000-2011. Comparison of results for both periods is crucial for identification of the role of economic crisis in determining exchange rate volatility in the European transition economies. [ABSTRACT FROM AUTHOR]

This paper is a result of a reaction to delay in statistical data source regarding territorial economic reality. For example, in Romanian statistics, the national account indicators (GDP, added value, industrial output, etc.) in regional profile are available only for 2008. On the other hand, economic reality is talking about an unpredictable end of the economic crisis, both in global economy and in the Romanian economy. When statistical data is available we expect that the global economic crisis will be over and we try to find what type of back-up analysis will be adequate for the present regional economic state. In these circumstances, based on the available regional data, we try to estimate the predictable regional patterns of the propagations of the global economic crisis shocks into the Romanian economy, step by step, from 2008 to 2011. Thus, we begin with a quite integrate profile of the regional development in 2008 and, afterwards, based on a series of statistical data for the 2009-2011 period, we try to project predictable trends. The main equations of our research consist in: is there a stochastic pattern in global economic crisis propagation at regional level in the Romanian economy, or are there some consistent factors advocating a scientific explanation of regional disparities during economic crisis period. Taking in account this research objective, we implement an econometrical cross-section analysis of the main economic regional indicators between 1998-2008 and try to compare the estimated forecasts with the available regional statistics for the 2008-2011 period. [ABSTRACT FROM AUTHOR]

The financial crisis has caused the economic system both direct and indirect effects. Negative macroeconomic shocks have had a direct impact on the results of leasing companies, and effects such as panic and "nervous breakdown" also had major repercussions. The purpose of this paper based on a qualitative marketing research is knowing, on the one hand, the effects of the crisis on the consumption of leasing products/services and, on the other hand, the factors that caused these effects. The study also aimed to outline the possible evolution of the leasing services offers over the next three years, taking in consideration the measures taken by leasing companies in order to restart the financing process through this system. [ABSTRACT FROM AUTHOR]

Copyright of Financial Sciences / Nauki o Finansach is the property of Uniwersytet Ekonomiczny we Wroclawiu and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)