In this paper we investigate whether differences we observe in European labour market transmission mechanisms matter for monetary policy design. We are particularly concerned with the robustness of the choice of rule by the European Central Bank (ECB) but we also comment on the choice of rules...

The policy regime in Europe has put the economy on 'auto-pilot'. We investigate different designs for the required feedback mechanisms. The uncertainty facing an economy depends on the pattern of shocks it faces, the response of the private sector to those shocks and also the policy reactions of...

This article evaluates the density forecasts of inflation published by the Bank of England and the National Institute of Economic and Social Research. It extends the analysis of the Bank of England’s fan charts in an earlier article by considering data up to 2003, quarter 4, and by...

The production of this forecast is supported by the Institute's Corporate Members: Bank of England, Barclays Bank pic, Ernst and Young LLP, GlaxoSmithKline, Marks and Spencer plc, Morgan Stanley Dean Witter (Europe) Ltd, Morley Fund Management, The National Grid Company pic, Nomura Research...

We construct a framework for evaluating the macroeconomic impact on the UK economy of policies that are aimed at reducing the number of people receiving social security benefits by helping them into employment. By means of model simulation we evaluate the gains to the economy in terms of output,...

Fiscal pacts and automatic stabilisers are widely discussed in the policy debate. Pacts put bounds on borrowing, and the bounds have to be evaluated. We use our model, NiGEM, to set safe targets for European deficits. Although there are many issues to consider, we conclude that cyclically...