Does an improvement in growth prospects lead to a fall in the trade balance? The answer in the literature with a strong focus on the U.S. economy is yes. However, we do not find that improved growth prospects (news shocks) necessarily lead to negative trade balance effects in the G7 countries....

Does an improvement in growth prospects lead to a fall in the trade balance? The relevance of this question stems from the tendency for countercyclical fluctuations in the trade balance stressed by both the academic literature and policymakers. However, we do not find that improved growth...

Does an improvement in growth prospects lead to a fall in the trade balance? The relevance of this question stems from the tendency for countercyclical fluctuations in the trade balance stressed by both the academic literature and policymakers. However, we do not find that improved growth...

Global liquidity expansion has been very dynamic since 2001. Contrary to conventionalwisdom, high money growth rates have not coincided with a concurrent rise in goodsprices. At the same time, however, asset prices have increased sharply, significantlyoutpacing the subdued development in...

This paper investigates the relationship between the exchange rate regime and the degree of structural reforms using panel data techniques. We look at a broad sample of countries (the "world sample") and also an OECD sample. Our main findings suggest that adopting a fixed exchange rate rule is...

(Wie) Reagieren Aktien-Returns auf die Geldpolitik? Eine ARDL-Analyse für Deutschland Sind Zentralbanken in der Lage, Aktienmarktrenditen systematisch zu beeinflussen? Um diese Frage zu beantworten, testen wir die Kointegrationsbeziehung zwischen Renditemaßen für den Aktienmarkt und dem...

One of the most interesting questions for policymakers which have emerged from the financial crisis deals with the strength of links between the demand and supply sides of the economy. The traditional view that only cyclical policies influence the former, and structural policies the latter has...

The belief that the ECB follows the US Federal Reserve in setting its policy is so entrenched with market participants and commentators that the search for empirical support would seem to be a trivial task. However, this is not the case. We find that the ECB is indeed often influenced by the...

The belief that house prices are driven by specific regional and institutional variables and not at all by monetary conditions is so entrenched with some market participants and some commentators that the search for empirical support would seem to be a trivial task. However, this is not the...

This paper examines the effect of government ideology on monetary policy in a quarterly data set of 15 OECD countries in the period 1980.1-2005.4. Our Taylor-rule specification focuses on the interactions of a new time-variant indicator for central bank independence and government ideology. The...