April 2021
28Apr

Latin America. What Comes After the Commodity Super Cycle and the Pandemic? Policies to Tackle Poverty and Inequality in Latin America

Latin America entered the pandemic as one of the most unequal regions in the world. And like much of the rest of the world, it will come out of the pandemic poorer and more unequal. Early estimates suggest that 19 million more people in the region have fallen into poverty and inequality increased by 5 percent compared to pre-crisis levels. Large scale public support in many countries prevented an even worse outcome, but this pushed public debt levels from...

April 28, 2021
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23Apr

Declining Natural Interest Rate in the US: The Pension System Matters

By Jacopo Bonchi, Giacomo Caracciolo The natural interest rate is the level of the real interest rate compatible with potential output and stable prices. We develop a life-cycle model and calibrate it to the US economy to quantify the role of the public pension scheme for the past and future evolution of the natural interest rate. Between 1970 and 2015, the pension reforms have overall mitigated the secular decline in the natural interest rate, raising it by around one percentage...

April 23, 2021
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15Apr

Involuntary unemployment in overlapping generations model due to instability of the economy and fiscal policy

By Yasuhito Tanaka The existence of involuntary unemployment advocated by J. M. Keynes is a very important problem of the modern economic theory. Using a three-generations overlapping generations model, we show that the existence of involuntary unemployment is due to the instability of the economy. Instability of the economy is the instability of the difference equation about the equilibrium price around the full-employment equilibrium, which means that a fall in the nominal wage rate caused by the presence of involuntary...

April 15, 2021
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05Apr

New GPIF Board Head Says Fund Isn’t Distorting Japan Stocks

By Chikafumi Hodo, Emi Urabe Japan’s Government Pension Investment Fund, the world’s largest pension pot, considers the impact of its investments on markets and isn’t distorting the country’s stocks, said Hirohide Yamaguchi, the newly appointed chairman of the fund’s board of governors. Yamaguchi, a former deputy governor of the Bank of Japan, said also that it was important to look at the fund’s long-term returns, rather than focusing on the short-term. He spoke in Tokyo at his first press conference since...

April 5, 2021
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01Apr

Informal Sector in GDP: A Panel Estimation Method

By Nitesh Kansara, Gopal K. Basak, Pranab Kumar Das Estimation of the activities of the informal sector in an economy poses a serious problem for obtaining a correct estimate of GDP. This happens to be so because of the fact that informal sector activities are not registered. The literature has tried to solve the problem of estimation of the informal sector using the method of latent variables. The standard approach is generally aims to estimate for a single point. The present...

April 1, 2021
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March 2021
25Mar

Opportunities for Stronger and Sustainable Postpandemic Growth 2021 Latin American and Caribbean Macroeconomic Report

By Eduardo Cavallo, Andrew Powell The COVID-19 shock was a significant and traumatic crisis for Latin America and the Caribbean. The pandemic dealt the region what I previously described as an unprecedented triple sudden stop, with major simultaneous disruptions in human mobility, trade, and capital flows. This was immensely dangerous. As human mobility was paralyzed by lockdowns and fear of contagion, investments fell, and trade was upended, the triple sudden stop challenged the region like few things in the past....

March 25, 2021
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05Mar

Pensions after the financial and economic crisis: a comparative analysis of recent reforms in Europe

By David Natali This paper sheds light on the initial impact of the economic and financial crisis on pensions policy across Europe, and assesses the first measures proposed and/or introduced in four EU countries. The author argues that while the impact on different pension models naturally varies, some common trends can be identified: short-term measures to grant additional protection for the elderly at risk of poverty, raising of the statutory retirement age, incentives for active ageing. The role of private...

March 5, 2021
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05Mar

Joint Report on Pensions Progress and key challenges in the delivery of adequate and sustainable pensions in Europe

By the Economic Policy Committee (Ageing Working Group), the Social Protection Committee (Indicators Sub-Group) and the Commission services (DG for Economic and Financial Affairs and DG Employment, Social Affairs and Equal Opportunities) Ensuring that public policies cater for sustainable, accessible and adequate retirement incomes now and in the future remains a priority for the EU. While Member States share similar fundamental challenges there are considerable differences in the timing of demographic ageing, the design of pension arrangements, the growth potential...

March 5, 2021
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05Mar

Society, Economy and Development During the COVID-19 Pandemic: Lesson for Emerging Economies

By Lovelina Little Flower FX, Sigamani Panneer, Hilaria Soundari, Lekha Bhat, Tresa Sugirtha J, Santhosh JS, Mhadeno Y Humtsoe, Vigneshwaran S A, Jeya Baskaran S and Samuel Paul Raj The unprecedented COVID-19 pandemic impacted with multidimensional crisis has disrupted the functioning of the society, devastated global economy and has debilitated development. The appalling implications varied from country to country depending on their economy, health infrastructure, and socio-political factors. This in turn has also reflected on their responses to the pandemic...

March 5, 2021
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February 2021
17Feb

My word is my bond: Linking sovereign debt with national sustainability commitments

By Anderson Caputo Silva, Fiona Stewart The global COVID-19 pandemic has caused millions of deaths and the greatest global economic downturn in nearly a century. Public debt increased by $8.5 trillion in 2020, up to September, including by $1.4 trillion in emerging markets. At the same time, unprecedented levels of investment will be needed to fund COVID-19 stimulus and relief packages, as well as to address the challenges posed by climate change and the degradation of ecosystems that regulate the...

February 17, 2021
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