This paper explores the quantitative plausibility of three candidate explanations for the European productivity slowdown with respect to the US. The empirical plausibility of the common wisdom on the topic (the IT usageʺ hypothesis) is found to crucially depend on how IT-using industries are...

I review theoretical arguments suggesting that certain labour market institutions can be justified for economic efficiency reasons. In models with intrinsic market failures, rigiditiesʺ like employment protection legislation and institutional wage compression may push the economy closer to the...

This paper provides an overview of recent papers which use estimated New Keynesian models to study the extent to which fiscal policy can be used to stabilize the economy. We use a variety of different New Keynesian models, estimated on data for both the US and for the Euro area, and highlight...

There is no consensus about the causes of the reduction in business cycle volatility seen in many major economies over the last decade. Using stylised models of the economies of the US, Euro area, UK and Japan, we argue that economic stability has been fostered by improved monetary policy and by...

In this paper we assess the empirical performance of commonly used empirical specifications of the baseline New Keynesian model for the US and the euro area. We estimate standard specifications of the model and extended specifications also including non-standard determinants of aggregate supply...

This paper analyses the sources of U.S. labour productivity growth in the late 1990s and presents projections for both output and labour productivity growth. We show that investment in information technology (IT) played a substantial role in the U.S. productivity revival and that similar trends...

This paper reviews the U.S. welfare reform efforts over the 1990s and the effects of these reforms to date. Seven lessonsʺ of potential interest to European observers are discussed, with particular attention to the conclusions of more recent research. Such research indicates, for example, that...

In this paper we analyse labour productivity growth in 51 industries in European countries and the United States. Using shift-share techinques we identify the industries in which the U.S. is leading most strongly. With a detailed decomposition analysis we identify whether the sources of the U.S....

This article reviews the US productivity growth experience over the last decade and discusses a set of issues that will likely impact productivity growth over the next decade. I begin by examining the evolving productivity picture since the early 1990s by looking at vintage data on actual...