In 1997 Chancellor Kohl proposed a major pension reform and pushed the law through Parliament explaining that the German PAYG system had become unsustainable. One limitation of the new law -- one that is crucial for our identification strategy -- is that it left the generous pension entitlements...

The paper presents a theoretical model of how banks and the non-bank private sector respond to changes in monetary policy. Unlike many textbook models in which banks play no active role, the banking sector is recognised here as playing a key part in transmitting changes in monetary policy to the...

This paper assesses the performance of a simple monetary policy rule - McCallum's rule. This rule targets nominal income using the monetary base as its instrument whilst making an allowance for any on-going changes in money velocity. The paper conducts a range of historical counterfactual...

Over the past year and a half, the Bank of England and the Bank of Canada have been developing a framework for the resolution of international financial crises that aligns incentives for all parties to deal with a crisis and preserve the integrity of the international financial system. The...

The paper argues that while attempts have been made to reform four of the five key pillars of banks’ operation, (i.e. competition, resolution, supervisory, and auditing and valuation policies), less attention has been paid to the role of bank governance and systemic risk, despite a strong link...

In 1997 Chancellor Kohl proposed a major pension reform and pushed the law through Parliament explaining that the German PAYG system had become unsustainable. One limitation of the new law -- one that is crucial for our identification strategy -- is that it left the generous pension entitlements...

This paper uses German micro data and a quasi-natural experiment to provide new evidence on the empirical importance of precautionary savings. Our quasi-natural experiment draws on a sharp increase in uncertainty (as reported in a survey of German citizens) observed in the run-up to the 1998...

Most macroeconomic forecasters underestimated global investment during the late 1990s. One potential reason was that the models they were using were insufficiently disaggregated. In this paper, an empirical model is estimated whose out-of-sample forecasts largely predicted the global investment...