scholarly journals Assessing the European Central Bank's unconventional measures: A recursive VAR approach

2021 ◽  
Vol 13 (2) ◽  
pp. 11-27
Author(s):  
Filip Peovski ◽  
Gjorgji Gockov
Keyword(s):  
Industrial Production ◽  
Negative Impact ◽  
Balance Sheet ◽  
Quantitative Easing ◽  
Economic Stability ◽  
The Great Recession ◽  
European Central ◽  
Crisis Recovery ◽  
Main Variable ◽  
The Impact

Unconventional monetary measures utilization has proven to be of great importance in maintaining monetary and economic stability after the Great Recession. However, we aim to test this conclusion through the impact of the quantitative easing implemented by the European Central Bank. Observed through generated shocks in the balance sheet of the Eurosystem as our main variable, we tested whether quantitative easing reestablished economic growth and rose price levels, mainly through lowering borrowing costs for banks, thus helping in the post-crisis recovery. To prove our hypotheses we construct a recursive VAR model estimated in levels using 2014M05-2018M12 data. The model incorporates variables such as the industrial production and the HICP, as output and price level proxies, and financial components such as the EONIA-MRO spread and the CISS index. The results show that the expansion shocks of the consolidated balance sheet have a positive temporary influence on industrial production and the HICP, but the reaction of the former seems to be 2.24 times greater. On the other hand, we find out that quantitative easing has an expected negative impact in widening the EONIA-MRO spread. Furthermore, we could not confirm the theoretically expected accommodative impact on financial stress.

Introduction

2019 ◽  
pp. 1-20
Author(s):  
Courtney Lewis
Keyword(s):  
Small Business ◽  
Small Businesses ◽  
Structural Adjustment ◽  
Business Owners ◽  
Small Business Owners ◽  
Economic Stability ◽  
The Great Recession ◽  
Justice Movements ◽  
The Impact

This introduction describes how encouraging a diversity of small businesses can help support a Native Nation’s long-term economic stability, but goes further to demonstrate this uniquely through the eyes of the small-business owners themselves along with an in-depth examination of their local, national, and international contexts. In doing so, it describes how this book also addresses the ways in which Native Nations, by supporting small business resilience, are responding in politically and socioeconomically meaningful ways to settler-colonial economic subjugations. This introduction further describes how the book unpacks the layers of small-business complications specific to Native Nations and American Indian business owners while speaking to larger theoretical questions regarding the impact of small businesses in a global indigenous context. Debates regarding economic sovereignty versus economic power, measures of autonomy, land status, economic identity, fluctuating relationships with settler-colonial society, and the growth of neoliberalism (along with its accompanying “structural adjustment” policies) meet with specific practices, such as the implementation of guaranteed annual incomes, cultural revitalization actions, environmental justice movements, and the potentially precarious choices of economic development—issues that are exacerbated during times of economic precarity, such as the Great Recession.

scholarly journals International Trade in the Aftermath of the COVID-19 Pandemic

2021 ◽  
Vol 65 (10) ◽  
pp. 15-23
Author(s):  
V. Zagashvili
Keyword(s):  
International Trade ◽  
Industrial Revolution ◽  
Negative Impact ◽  
Mutual Recognition ◽  
Structural Factors ◽  
Economic Stability ◽  
International Trading ◽  
National Boundaries ◽  
Long Term Impact ◽  
The Impact

The article examines the implications of the COVID‑19 pandemic for the development of international trade. The international trading system has demonstrated sufficient maturity and the ability to remain stable even in extreme conditions. The negative impact of COVID‑19 on trade was provided through a general drop in demand, disruptions in and business travel. Attempts to foster economic stability and enhance the resilience of global value chains through self-reliance and limiting supply network within national boundaries are counterproductive. The solution to the efficiency versus safety dilemma lies in the area of diversification. In the medium term after the expected rapid recovery growth the development of international trade is likely to slow down and the growth rates of trade and production will trend towards convergence. The long-term impact of the pandemic on international trade will be manifested through the impact of structural factors: the Fourth Industrial Revolution, trends in the field of transnational production, changes in the paradigm of social development, competition between economic policy models, rivalry between leaders of the world economy, and the results of efforts to regulate trade on the multilateral basis. The pandemic made more obvious the need for cooperation, not only in the narrow aspect of coordinating anti-epidemic measures, but also in the broader sense of promoting development and narrowing the gap in welfare, health care and the quality of life in general, both in different countries and within countries. In the area of trade policy, it highlighted the urgent need for closer cooperation in overcoming barriers to trade (lowering duties, removing technical barriers, mutual recognition of sanitary certificates, interfacing digital regulation systems). The disunity and noticeable confusion of governments during the pandemic emphasized the task of overcoming the WTO crisis.

scholarly journals Pre- and Post-GFC Policy Multipliers

2020 ◽  
Vol 20 (237) ◽  
Author(s):  
Sam Ouliaris ◽  
Celine Rochon
Keyword(s):  
Central Bank ◽  
Interest Rates ◽  
Balance Sheet ◽  
Quantitative Easing ◽  
Dynamic Effects ◽  
Real Gdp ◽  
Rate Environment ◽  
The Impact ◽  
Policy Multipliers ◽  
The U.S

This paper estimates the change in policy multipliers in the U.S. relative to their pre-2008 financial crisis levels using an augmented Blanchard-Perotti model to allow for the dynamic effects of shocks to the central bank balance sheet, real interest rates and debt levels on economic activity. Given the elevated debt level and significantly larger central bank balance sheet in the U.S. after 2008, the paper estimates the likely impact of new stimulus packages. We find that expenditure multipliers have fallen post-2008 crisis because of higher government debt, implying that the effectiveness of fiscal policy has declined. The analysis also investigates the impact of quantitative easing. The results suggest that it is beneficial, but requires sizable balance sheet interventions to lead to noticeable effects on real GDP. The results are used to assess the impact of the policy packages to address COVID-19. Because of rising debt stocks, dealing with a crisis is becoming more and more costly despite the current low interest rate environment.

scholarly journals International Real Estate Review

2020 ◽  
Vol 23 (2) ◽  
pp. 189-210
Author(s):  
Nicholas Apergis ◽  
Keyword(s):  
Natural Disasters ◽  
Negative Impact ◽  
House Prices ◽  
Panel Regression ◽  
Quantitative Easing ◽  
Real Economy ◽  
Climate Change Effects ◽  
Lower House ◽  
Mitigate Climate Change ◽  
The Impact

Given that the literature on the impact of natural disasters on house prices is highly limited, this paper combines data on natural disasters and house prices from 117 countries, which span the period 2000-2018 and a panel regression method to estimate the effects of natural disasters on house prices. The findings document that natural disasters lead to lower house prices, with the results surviving a number of robustness tests. When examining the impacts of natural disasters by type, the findings highlight that geological disasters exert the strongest (negative) impact on house prices. The results also illustrate the negative impact of those disasters on house prices when also taking the distinction between small and large disasters into account. The findings provide important implications for policymakers and property investors. Lower house prices in countries that experience natural disasters events could significantly signify lower consumption and investment (the wealth effect), with further negative spillovers to the real economy. Economic policymakers could implement low-tax policies or quantitative easing schemes to support these areas/countries. The findings exemplify the need for governments and policymakers to mitigate climate change effects on housing by adopting new and more environmentally friendly technologies and energy sources.

The Great Recession and Physical Activity of Young Adults

2021 ◽  
pp. 155982762110084
Author(s):  
Shamma Adeeb Alam ◽  
Bijetri Bose
Keyword(s):  
Physical Activity ◽  
Young Adults ◽  
Physical Exercise ◽  
Great Recession ◽  
Fixed Effects ◽  
Negative Impact ◽  
Panel Study ◽  
The Great Recession ◽  
Nationally Representative ◽  
The Impact

Objective. Since physical inactivity has been identified as a pandemic and a public health priority, it is crucial to understand the role of adverse economic shocks on physical activity. In this study, we examine the impact of job losses during the U.S. Great Recession from January 2008 to June 2009 on the likelihood of physical activities of young adults. Methods. We use individual fixed effects estimation on a nationally representative longitudinal data from 2005 to 2015, the Panel Study of Income Dynamics (PSID), to examine the impact of job losses of young adults, their spouses, and their parents on physical exercise of young adults aged 18 to 27 years. Results. Own job losses during the Great Recession led to a decrease in the likelihood of physical exercise among young adults. However, job losses of parents and partners had no effect on the likelihood of young adults’ physical exercise. Conclusion. Our findings indicate a negative impact of the recession on physical activity of young adults and highlights the need for policymakers to consider the impact of major economic downturns on the physical activity of young adults.

scholarly journals Estimation of Impact of Quantitative Easing Policy on EUR/USD using behavioral Equilibrium Exchange Rate Model

2019 ◽  
Vol 23 (4) ◽  
pp. 117-128
Author(s):  
A. A. Vinogradov
Keyword(s):  
Exchange Rate ◽  
Federal Reserve ◽  
Quantitative Easing ◽  
Rate Model ◽  
Equilibrium Exchange Rate ◽  
European Central ◽  
Equilibrium Exchange ◽  
The Us ◽  
Behavioral Equilibrium Exchange Rate ◽  
The Impact

The article examines the impact of the policy of the uSA quantitative easing and the euro area on the nominal EuR/ uSD exchange rate. After the economic crisis of 2008–2009, the policy of quantitative easing gained popularity among the world’s largest economies. The largest programs were implemented by the uS Federal Reserve (uS Federal Reserve System) and the European Central Bank (ECB). However, the impact of the actual purchase volume of securities on the EuR/uSD exchange rate within these policies has been little studied in modern literature. The author collected the data from 1999 to 2018 on the exchange rate, macroeconomic and market indicators, and calculated the monthly actual purchase volumes of securities under the asset purchase program of the united States and the euro area. The behavioral equilibrium exchange rate model was used. The linear model specification and the error correction model identified no significant impact of the ECB quantitative easing policy expressed in the actual purchase volume of securities. However, for some specifications, it has been proven that the increase in purchases of securities by the uS Federal Reserve leads to a weakening of the dollar against the euro. The cointegration test revealed a long-term dependence of the EuR/uSD exchange rate on the accumulated volumes of acquired assets. Thus, an increase in the purchase volume of securities led to a weakening of the dollar against the euro. The insignificant impact of the European Central Bank quantitative easing policy could have been caused by market expectations formed prior to the actual purchase of ECB securities in the market.

scholarly journals Qualitative easing and risk transfer from corporations to central banks

2015 ◽  
Vol 12 (3) ◽  
pp. 201-210
Author(s):  
Roberto Moro Visconti ◽  
Maria Cristina Quirici
Keyword(s):  
Yield Curve ◽  
Balance Sheet ◽  
Central Banks ◽  
Quantitative Easing ◽  
Monetary Policies ◽  
Risk Premiums ◽  
Risk Pooling ◽  
Risk Transfer ◽  
Real Value ◽  
The Impact

When economies face deflation and de-growth, Central Banks can only activate unconventional monetary policies. Quantitative easing inflates the Central Bank balance sheet, printing money and adding liquidity to the system while qualitative easing modifies the asset composition. With qualitative easing, Central Banks absorb the risk, flattening the yield curve. Consequences for banks and corporate borrowers may be substantial. Both measures increase inflation and reduce borrowing risk premiums, with an impact on company’s balance sheet, widening economic and financial margins and decreasing the real value of debt. Corporate governance implications concern credit risk pooling, as well as (de)leverage, asset substitution and duration risk. This paper provides unprecedented analysis of the impact of ECB unconventional monetary policy on Euro-zone governance equilibrium

scholarly journals The Impact of the ECB’s Quantitative Easing Policy on Capital Flows in the Cesee Region

2018 ◽  
Vol 7 (2) ◽  
pp. 25-48 ◽  
Author(s):  
Anita Angelovska-Bezhoska ◽  
Ana Mitreska ◽  
Sultanija Bojcheva-Terzijan
Keyword(s):  
Capital Flows ◽  
Balance Sheet ◽  
Capital Inflows ◽  
Eastern Region ◽  
Quantitative Easing ◽  
Fiscal Policies ◽  
Trade And Financial Linkages ◽  
The Government ◽  
Almost All ◽  
The Impact

Abstract This paper attempts to empirically assess the impact of the ECB’s quantitative easing policy on capital flows in the countries of the Central and South Eastern region. Given the tight trade and financial linkages of the region with the euro area, one should expect that the buoyant liquidity provided by the ECB might affect the size of the capital inflows. We test this hypothesis by employing panel estimation on a sample of 14 countries CESEE countries for the 2003-2015 period. Contrary to the expected outcome, the results reveal either negative or insignificant impact of the change in the ECB balance sheet on the different types of capital inflows. The results suggest that the magnitude of the crisis, to which the ECB responded to was immense, hence precluding any significant impact of the monetary easing on capital flows in the region. The inclusion of a dummy in the model, to control for the 2008 crisis confirms the findings from the first specification and also does not change the finding on the ECB quantitative easing impact on the capital flows. The impact of the crisis dummy on capital flows is negative and it holds for almost all types of capital inflows, except for the government debt flows, which is consistent with the countercyclical fiscal policies and rising public debt after the crisis.

scholarly journals A systematic review of the impact of the Great Recession on food intake

2020 ◽  
Vol 30 (Supplement_5) ◽  
Author(s):  
R H Jenkins ◽  
E P Vamos ◽  
D Taylor-Robinson ◽  
C Millett ◽  
A Laverty
Keyword(s):  
Systematic Review ◽  
Food Intake ◽  
Energy Intake ◽  
Great Recession ◽  
Negative Impact ◽  
Grey Literature ◽  
Dietary Quality ◽  
The Great Recession ◽  
Economic Downturns ◽  
The Impact

Abstract Background The 2007-2009 Great Recession significantly impacted global economies, industries, and individuals around the world, with a potential impact on health behaviours including dietary intake. Given the global reach and severity of the Great Recession, changes in food intakes may impacted health and health inequalities internationally. We conducted a systematic review examining whether the Great Recession had an impact on food intakes. Methods We searched MEDLINE, Embase, PsycINFO, Health Management Information Consortium (HMIC), CINAHL and Web of Science databases, along with relevant grey literature, in June 2020. Primary quantitative studies with the Great Recession as the exposure and food intake as the outcome and with two time points were eligible for inclusion in this review, assessed independently by two reviewers. The Newcastle Ottawa scale was used for quality assessment. The study was registered with PROSPERO (CRD42019135864). Results Forty-one studies from twenty-five countries were included in this review. Studies were heterogeneous in methods and results. Nine of ten studies on energy intake found that total energy intake decreased over the recession. Eight of eleven studies on dietary quality found that the recession was associated with poorer diet. Thirty-four studies assessed impact on individual food groups. They found that consumption of fruits and vegetables, meat and fish, and fast food, confectionery and soft drinks generally decreased while egg and legume consumption increased and carbohydrate consumption exhibited little change. The impact was generally greater on those of lower socio-economic position. Conclusions While our review presents mixed findings about the impact of the Great Recession on food intake, there is consistent evidence of a negative impact on diets. Identifying effective policies which mitigate adverse changes in nutrition during economic downturns should be prioritised at the national and international level. Key messages Our systematic review of the Great Recession and food intakes demonstrates potential relationships between economic downturns and nutrition – these relationships may be important for health globally. Our systematic review demonstrates that it is important for policy-makers and public health professionals to consider mitigating potential nutritional impacts during economic recessions.

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