Download or read book Wage Growth and Inflation in Europe A Puzzle written by Vizhdan Boranova and published by International Monetary Fund. This book was released on 2019-12-20 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: Wages have been rising faster than productivity in many European countries for the past few years, yet signs of underlying consumer price pressures remain limited. To shed light on this puzzle, this paper examines the historical link between wage growth and inflation in Europe and factors that influence the strength of the passthrough from labor costs to prices. Historically, wage growth has led to higher inflation, but the impact has weakened since 2009. Empirical analysis suggests that the passthrough from wage growth to inflation is significantly lower in periods of subdued inflation and inflation expectations, greater competitive pressures, and robust corporate profitability. Thus the recent pickup in wage growth is likely to have a more muted impact on inflation than in the past.
Download or read book European Wage Dynamics and Spillovers written by Yuanyan Sophia Zhang and published by International Monetary Fund. This book was released on 2019-07-19 with total page 29 pages. Available in PDF, EPUB and Kindle. Book excerpt: Wage rises have remained stubbornly low in advanced Europe in recent years, but, at the same time, newer EU members are experiencing rapid wage acceleration. This paper investigates the drivers of this wage divergence. Econometric analysis using error correction models suggests that wage growth responds more quickly to changes in unemployment in the newer EU members than in advanced Europe, where wages are more closely related to inflation and inflation expectations in the short run, implying greater inertia in nominal wage rises in advanced Europe. In the years after the global crisis, this inertia contributed to the build up of a real wage overhang relative to sharply slowing labor productivity, which subsequently dragged on nominal wage rises even as unemployment began to decline. Spillovers of subdued wage growth between euro area countries also weighed on wage rises in advanced Europe.
Download or read book Inflation and Wage Behaviour in Europe written by Paul de Grauwe and published by Oxford University Press. This book was released on 1996 with total page 372 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Maastricht Treaty makes the convergence of inflation rates one of the preconditions of European Monetary Union (EMU). The purpose of this study is to shed light on the mechanism underlying the processes that lead to convergence or divergence in national inflation rates. It examinesinflation and wage bahaviour in the European Monetary System (EMS), their determinants, and their implications for the credibility and sustainability of the system's exchange rate mechanism (ERM). Although the focus is on the EMS period, eleven of the twelve studies also review the background of the1970s. The contributors examine issues of monetary control, stability of national and ERM-wide money-demand function, the monetary policy of Germany - the pivotal country in the EMS - and its influence on the stability of the system after the fall of the Berlin Wall. As well as explaining how theEMS worked, the book also offers reasons for its breakdown in 1992-3 under the blow of exogenous shocks and growing policy conflict between member countries.The study identifies several causes of inflation and persistent inflation differentials in the EMS. Among the 'real' causes, particular attention is devoted to sectoral productivity shocks. In some countries, import price shocks, exogenous wage pushes, taxes, and government expenditure are bound tobe important factors. Since theses kinds of shock hit the various economies of the region differently, inflation differntials can persist for several years. The different policies of governments and central banks, and the fact the monetary policies have not always been consistent with the long-runmaintenance of fixed exchange rates, have also played a considerable role in explaining the persistance of inflation differentials.
Download or read book The Links Between Economic Activity and Inflation written by Marianne Ojo D Delaney PhD and published by . This book was released on 2019 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: Vlieghe (2018:7) refers to the “'exchange rate effects” of inflation and in this sense, a distinction is made between inflation which is attributed to a rise in prices, namely import prices - when the rate of exchange makes it more expensive for products to be imported - with the resulting effects that price increases are passed on to consumers.The central bank effect, as will be further highlighted in this paper, refers to the possible impact/s generated by central bank officials in responding to achieve inflation targets, by raising or lowering interest rates - and can hence be referred to as “the interest rate effect.”Daly (2019:4) on the other hand, argues that the “Fed Wedge” has contributed to the weakening of the link between economic activity and inflation.Why can some economic indicators still be considered to be applicable and relevant - even in an environment where so many advancements and financial instruments have significantly altered the financial landscape which existed over the years?In particular, why can the Philips Curve still be considered applicable and relevant - with reference to wage inflation and productivity? More importantly, what economic indicators can serve to provide more reliable indicators of inflationary levels once more temporary elements, as induced by import prices, have diminished?
Download or read book The Missing Inflation Puzzle written by Sebastian Heise and published by . This book was released on 2020 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Price inflation in the U.S. has been sluggish and slow to pick up in the last two decades. We show that this missing inflation can be traced to a growing disconnect between unemployment and core goods inflation. We exploit rich industry-level data to show that weakening pass-through from wages to prices in the goods-producing sector is an important source of the slow inflation pick-up in the last two decades. We set up a theoretical framework where markups and pass-through are a function of firms' market shares and show that increased import competition and rising market concentration reduce pass-through from wages to prices. We then use industry-level data and find strong support for these two channels consistent with the implications of our model.
Download or read book The Missing Inflation Puzzle written by Sebastian Heise and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Price inflation in the U.S. has been sluggish and slow to pick up in the last two decades. We show that this missing inflation can be traced to a growing disconnect between unemployment and core goods inflation. We exploit rich industry-level data to show that weakening pass-through from wages to prices in the goods-producing sector is an important source of the slow inflation pick-up in the last two decades. We set up a theoretical framework where markups and pass-through are a function of firms' market shares and show that increased import competition and rising market concentration reduce pass-through from wages to prices. We then use industry-level data and find strong support for these two channels consistent with the implications of our model.
Download or read book Wage and Inflation Dynamics in Denmark written by Raju Huidrom and published by International Monetary Fund. This book was released on 2023-07-19 with total page 16 pages. Available in PDF, EPUB and Kindle. Book excerpt: Nominal wage growth in Denmark has so far been modest and outpaced by high inflation, putting real wage growth in negative territory. Amid still-tight labor markets, this has raised concerns about wage pressures going forward and the eventual impact on inflation. The analysis suggests that wage formation in Denmark has historically been partly backward-looking, and economic slack also has played a role. Given these, high inflation realized thus far and the tightness in the labor market implies that wage pressures are expected to remain elevated in the near term. Some of these wage pressures, in turn, are expected to be passed on to core inflation, sustaining high inflation. Thus, determined policies to fight inflation are important.
Download or read book Regional Economic Outlook October 2019 Europe written by International Monetary Fund. European Dept. and published by International Monetary Fund. This book was released on 2019-11-06 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt: Economic activity in Europe has slowed on the back of weakness in trade and manufacturing. For most of the region, the slowdown remains externally driven. However, some signs of softer domestic demand have started to appear, especially in investment. Services and domestic consumption have been buoyant so far, but their resilience is tightly linked to labor market conditions, which, despite some easing, remain robust. Expansionary fiscal policy in many countries, and looser financial conditions, have also supported domestic demand. On balance, Europe’ s growth is projected to decline. A modest recovery is forecast for 2020 as global trade is expected to pick up and some economies recover from past stresses. This projection, broadly unchanged from the April 2019 World Economic Outlook, masks significant differences between advanced and emerging Europe. Growth in advanced Europe has been revised down, while growth in emerging Europe has been revised up. Amid high uncertainty, risks remain to the downside, with a no-deal Brexit the key risk in the near term. An intensification of trade tensions and related uncertainty could also dampen investment. More broadly, the weakness in trade and manufacturing could spread to other sectors—notably services—faster and to a greater extent than currently envisaged. Other risks stem from abrupt declines in risk appetite, financial vulnerabilities, the re-emergence of deflationary pressures in advanced economies, and geopolitics.
Download or read book Productivity Puzzles Across Europe written by Philippe Askenazy and published by Oxford University Press. This book was released on 2016 with total page 338 pages. Available in PDF, EPUB and Kindle. Book excerpt: A volume on labour productivity in Europe in the aftermath of the 2008 financial crisis. It provides rationales for recent productivity trends in France, the UK, Germany, and Spain, and analyses policy responses to the crisis and how these have affected post-recession outcomes.
Download or read book Productivity Growth Inflation and Unemployment written by Robert James Gordon and published by Cambridge University Press. This book was released on 2004 with total page 520 pages. Available in PDF, EPUB and Kindle. Book excerpt: Publisher Description
Download or read book The Monetary Economics of Europe written by Christopher Johnson and published by Fairleigh Dickinson Univ Press. This book was released on 1994 with total page 328 pages. Available in PDF, EPUB and Kindle. Book excerpt: Based on research commissioned by the European Parliament, this volume allows the economists contributing to offer their own explanations for the collapse of the European Monetary System, with the use of economic models.
Download or read book A European Minimum Wage Implications for Poverty and Macroeconomic Imbalances written by Ms.Enrica Detragiache and published by International Monetary Fund. This book was released on 2020-05-22 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: A hypothetical European Minimum Wage (MW) set at 60 percent of each country’s median wage would reduce in-work poverty but have limited effects on overall poverty, as many poor households do not earn a wage near MW and higher unemployment, higher prices, and a loss of social insurance benefits may erode direct benefits. Turning to competitiveness, since the MW increase to reach the European standard would be larger in euro area countries with excessive external surpluses, the associated real appreciation should help curb existing imbalances. However, a few countries with already weak external positions would experience an undesirable real appreciation.
Download or read book Global Wage Report 2018 19 written by International Labour Office and published by . This book was released on 2018-11-26 with total page 179 pages. Available in PDF, EPUB and Kindle. Book excerpt: The 2018/19 edition analyses the gender pay gap. The report focuses on two main challenges: how to find the most useful means for measurement, and how to break down the gender pay gap in ways that best inform policy-makers and social partners of the factors that underlie it. The report also includes a review of key policy issues regarding wages and the reduction of gender pay gaps in different national circumstances.
Download or read book Inflation Expectations written by Peter J. N. Sinclair and published by Routledge. This book was released on 2009-12-16 with total page 402 pages. Available in PDF, EPUB and Kindle. Book excerpt: Inflation is regarded by the many as a menace that damages business and can only make life worse for households. Keeping it low depends critically on ensuring that firms and workers expect it to be low. So expectations of inflation are a key influence on national economic welfare. This collection pulls together a galaxy of world experts (including Roy Batchelor, Richard Curtin and Staffan Linden) on inflation expectations to debate different aspects of the issues involved. The main focus of the volume is on likely inflation developments. A number of factors have led practitioners and academic observers of monetary policy to place increasing emphasis recently on inflation expectations. One is the spread of inflation targeting, invented in New Zealand over 15 years ago, but now encompassing many important economies including Brazil, Canada, Israel and Great Britain. Even more significantly, the European Central Bank, the Bank of Japan and the United States Federal Bank are the leading members of another group of monetary institutions all considering or implementing moves in the same direction. A second is the large reduction in actual inflation that has been observed in most countries over the past decade or so. These considerations underscore the critical – and largely underrecognized - importance of inflation expectations. They emphasize the importance of the issues, and the great need for a volume that offers a clear, systematic treatment of them. This book, under the steely editorship of Peter Sinclair, should prove very important for policy makers and monetary economists alike.
Download or read book The Interaction of Monetary Policy and Wage Bargaining in the European Monetary Union written by S. Dullien and published by Springer. This book was released on 2004-10-11 with total page 291 pages. Available in PDF, EPUB and Kindle. Book excerpt: Sebastian Dullien gives a novel explanation for unemployment and inflation in the Euro-Zone. He argues that unemployment stems from a lack of co-operation between unions and monetary authorities: In an economy with endogenous money as EMU, wage setters are responsible for price stability while the central bank is responsible for the level of output. Co-operation between both actors is necessary for high employment and low inflation. The current institutional set-up is found to be unable to assure cooperation.
Download or read book Essays on the Great Depression written by Ben S. Bernanke and published by Princeton University Press. This book was released on 2024-01-09 with total page 352 pages. Available in PDF, EPUB and Kindle. Book excerpt: From the Nobel Prize–winning economist and former chair of the U.S. Federal Reserve, a landmark book that provides vital lessons for understanding financial crises and their sometimes-catastrophic economic effects As chair of the U.S. Federal Reserve during the Global Financial Crisis, Ben Bernanke helped avert a greater financial disaster than the Great Depression. And he did so by drawing directly on what he had learned from years of studying the causes of the economic catastrophe of the 1930s—work for which he was later awarded the Nobel Prize. Essays on the Great Depression brings together Bernanke’s influential work on the origins and economic lessons of the Depression, and this new edition also includes his Nobel Prize lecture.
Download or read book Denmark written by International Monetary Fund. European Dept. and published by International Monetary Fund. This book was released on 2023-06-26 with total page 25 pages. Available in PDF, EPUB and Kindle. Book excerpt: Denmark: Selected Issues
