Financial Crises and Current Account Surpluses

Atlantic Economic Journal - The Nordic countries of Denmark, Finland, Norway and Sweden have had persistent current account surpluses in recent decades. While oil production set Norway apart, the...     

Monetary Hegemony and its Implications for Small,Open Economies

The paper uses historical data on interest rates from 1920 to 2016 to explore whether a world rate of interest exists and whether a monetary hegemon affects it. The first principal component of long-term interest rates accounts for 75% of the variation in a matrix of 17 countries and proxies for the world rate of interest. The U.S. played the role of a hegemon, influencing long-term bond rates. After the introduction of the euro in 1999, interest rates in most European countries followed German interest rates but German rates followed U.S. rates even more than before the introduction of the euro. In two countries on the northern periphery, Denmark and Sweden, interest rates shadow German rates and the low rates have contributed to rising house prices and rising mortgage debt. Independent monetary policy calls for targeted controls on capital flows.

     

实际汇率、股价水平和就业路径的结构主义分析

真实汇率和真实股价水平可以作为预测因子,提前预测经济活动的强弱.自然利率能够在结构性繁荣和衰退期间担当中央银行利率政策的风向标,通过保持短期实际利率与自然利率的协调,中央银行能控制均衡的通货膨胀率,并使经济沿着随时间变化的自然失业率变化的轨道发展.美国和OECD国家的数据都证实了模型的有效性.     

Asymmetries exist in the Feldstein–Horioka relationship

Most studies assume symmetry between saving and investment changes. They are wrong to do so. We model the response of investment to positive and negative changes in saving for 17 OECD countries from 1960 to 2015. We use both panel and time series methods. We find that negative changes in saving have a stronger effect on investment than positive changes in saving do. In the short run, causality only runs from negative changes in saving to investment. In the long run, both negative and positive changes in saving Granger cause investment. Models relying on saving-investment symmetry in the long run are called into question. Policies assuming symmetric effects throughout the business cycle are similarly flawed.     

A health economic lifetime treatment pathway model for low back pain in Sweden

Aims: To develop a health economic model to evaluate the long-term costs and outcomes over the healthcare treatment pathway for patients with low back pain (LBP).

Materials and methods: A health economic model, consisting of a decision tree structure with a Markov microsimulation model at the end of each branch, was created. Patients were followed from first observed clinical presentation with LBP until the age of 100 years or death. The underlying data to populate the model were based on Swedish national and regional registry data on healthcare resource use and sickness insurance in patients presenting with LBP in the Swedish region Västra Götaland during 2008–2012. Costs (outpatient healthcare visits, inpatient bed days, pharmaceuticals, productivity loss), EUR 2016, and quality-of-life based on EQ-5D data from the registries and published estimates were summarized over the lifetime of the patients with 3% annual discount. A lost quality-adjusted life year (QALY) was valued at €70,000.

Results: Mean lifetime total cost was estimated at €47,452/patient, of which indirect costs were 57%. Total lifetime economic burden for all patients coming to clinical presentation in Sweden per year was €8.8bn. The average LBP patient was estimated to face a loss of 2.7 QALYs over their lifetime compared with the general population. For all patients in Sweden coming to clinical presentation in 1 year this gives 505,407 QALYs lost, valued at €35.3bn. Adding the economic burden, the total societal burden amounts to €44.1bn.

Conclusion: This pathway model shows that most patients with LBP receive conservative care, and a minority consume high-cost healthcare interventions like surgery. The model could be used to see broad economic effects of different patterns of healthcare provision in sub-groups with LBP and to estimate where it is possible to influence these pathways to increase utility for patients and for society.     

European Integration and the Feldstein–Horioka Puzzle

We apply the differences‐in‐differences method to study the effect of the European single market in 1993 and the euro in 1999 on the Feldstein–Horioka equation where countries outside the single market serve as a control group and those within as a treatment group. We find structural breaks that coincide with both events, in addition to the financial crisis in 2008. The results suggest that the correlation between investment and savings depends on institutions, exchange rate risk and credit risk. Furthermore, the pattern of capital flows within the single market leaves a significant part of the flows unexplained by fundamentals.     

Employment and asset prices

A medium-term relationship exists between share prices, normalized by labour productivity, and the rate of unemployment in the Organization for Economic Co-operation and Development (OECD) countries. This helps explain decadal changes in mean unemployment, such as the shift to higher mean unemployment in the Continental European countries in the 1970s and 1980s that coincided with a fall in the level of share prices, as well as differences in mean unemployment between countries.