“Macro Policies in Turbulent Times” – #KKG107 takes a closer look at key issues in monetary and fiscal affairs. Macroeconomically, the recent years have been turbulent times indeed. Both the pandemic as well as the energy crisis brought about new challenges for monetary and fiscal...

We evaluate the impact of loan-to-value restrictions on household financial vulnerability. Using Norwegian tax data, we first document a beneficial leverage effect, in which households respond to the regulation by reducing house purchase probabilities, debt and interest expenses. Second, we...

We introduce shocks to the availability of US dollar funding for non-US financial intermediaries in a two-country New Keynesian model with financial frictions. Such dollar shortages lead to uncovered interest rate parity deviations and have a significant negative effects on the macroeconomy....

This paper investigates how monetary expansion affects household consumption and savings through household debts. Using monetary policy cuts in China in the end of 2008 as an experiment, we find that the resulted increase in indebted households’ disposable income leads to increasing...

This paper develops a new class of poverty and inequality measures we call common prosperity. This measure complements existing classes of measures and allows decomposition across income sources or components of consumption expenditure. This framework enables us to study the trade-off between...

China has established its role as a major world lender, and policy changes affecting its external position would therefore have pronounced effects over a range of countries and on the global financial landscape in general. In this paper, I characterize China’s external asset holdings and macro...

Having barely recovered from the successive waves of the Covid-19 pandemic, European economies are now facing another serious shock. The Russian invasion of Ukraine and the sanctions that have followed have given rise to inflation rates unseen for several decades, driven primarily by higher...

Decades of investment decisions by central planners left communist societies with structures of production ill-prepared for competitive markets. Their vulnerability to liberalization, however, varied across space. Similar to the effects identified in the "China shock'' literature, we hypothesize...

Seit einem Jahr beherrscht die Inflation wieder die Schlagzeilen, und das nicht nur in Deutschland. Mit dem Krieg in der Ukraine erreichen die Inflationsraten neue Rekordhöhen. Die Antworten auf die Fragen: „Wie lässt sich die hohe Inflationsrate erklären? Inwieweit ist die...

The macroeconomic impacts of the quantitative easing programs enacted by the major central banks worldwide have been examined in many scientific articles. An increasing number of papers have additionally explored the spillover effects of the US and – to a lesser degree EA and UK - QE programs...