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Working Paper
Trade in ideas: patenting and productivity in the OECD
Report
Has the cost of fighting inflation fallen?
During the 1980s, many OECD countries adopted labor-market policies designed to enhance wage flexibility and reduce unemployment. They also attempted to bolster the credibility of their anti-inflation measures through exchange rate and fiscal policies. These measures should have lowered the costs associated with fighting inflation. In this paper, we compare sacrifice ratio measures of the cost of disinflation in the most recent OECD recession with measures for the mid-seventies and early-eighties recessions. Surprisingly, in the overwhelming majority of OECD countries, the cost of reducing ...
Working Paper
Supply-side sources of inflation: evidence from OECD countries.
We evaluate the merits of the "supply-side" view under which inflation results from sectoral shocks, and compare it with the "classical" view in which inflation results from aggregate factors such as variations in money growth. Using a panel VAR methodology applied to data for 13 GECD countries, we find support for a multi-shock view of inflation: supply-side shocks are statistically significant determinants of inflation, even after taking into account aggregate demand factors. While oil prices are the dominant supply-side influence, other measures such as the skewness of relative price ...
Working Paper
Common fluctuations in OECD budget balances
We analyze comovements in four measures of budget surpluses for 18 OECD countries for 1980-2008 with a dynamic latent factor model. The world factor in national budget surpluses declines substantially in the 1980s, rises throughout much of the 1990s to a peak in 2000, before declining again in the most recent period. This world factor explains a substantial portion of the variability in budget surpluses across countries. World factors in national output gaps, dividend-price ratios, and military spending significantly explain variation in the world budget surplus factor. The significant ...
Journal Article
International business cycles: G7 and OECD countries
The progressive globalization of markets has sparked a worldwide interest in using economic indicators to analyze cyclical fluctuations. Governments and the private sector seeking to conduct their activities in light of both national and international economic conditions could benefit from international indicators that serve as a warning system to detect recessions in major economic partners and in industrialized countries as a whole. ; This article constructs just such a warning system. Using a Markov-switching dynamic factor model with a self-adjusting variable-bandwidth filter, the authors ...
Report
Capacity utilization-inflation linkages: a cross-country analysis
This paper analyzes whether capacity utilization in manufacturing is a reliable inflation indicator over and above economy-wide indicators of inflationary pressure and examines different theories on the propagation of inflation by testing their implications for the relationship between capacity utilization and inflation. Three mechanisms whereby shocks to manufacturing can impact on inflation are explored: First, direct pressure on producer prices in manufacturing arising from bottlenecks and a slowdown in productivity growth at high operating rates, second, spill-overs of ...