International and Monetary Economics Network

Public Lecture, November 28, 6.30 pm: The OECD Minimum Tax: A Win for Switzerland? A Win for the World? With Dr. David Staubli (Federal Tax Administration), Dominik Gross (Alliance Sud), and Dr. Christian Frey (Economiesuisse)

A few years ago, the member states of the Organisation for Economic Co-operation and Development (OECD) came to the conclusion that the existing taxation of large multinational companies was no longer appropriate. A global minimum tax rate of 15 percent on profits was agreed upon for these companies (with annual revenue of 750 million or more). Switzerland has now implemented this OECD minimum tax as of January 1, 2024. We are pleased to have secured three distinguished experts in Switzerland to discuss the pros and cons of the OECD Minimum Tax: David Staubli from the Federal Tax Administration, Dominik Gross from the non-governmental organization Alliance Sud, and Christian Frey from the business association Economiesuisse.
 

• Title: The OECD Minimum Tax: A Win for Switzerland? A Win for the World?
• Date and time: November 28, 2024, 6:30-7:30 PM
• Main Building University of Bern, Hochschulstrasse 4, Room HS 220
• Lecture and discussion in German. Followed by a reception.

Thank you for your registrations. You can still register HERE

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The ECB Conference on Monetary Policy 2024 featured an impressive academic line-up and was held as a hybrid event. By the way, a paper co-authored by Laura Gáti was presented. She is an alumna of the Master’s program in International and Monetary Economics (MIME). Most papers can be downloaded here:

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Valuable food for thought by Andreas Müller, Kjetil Storesletten, and Fabrizio Zilibotti

Structural Reforms in the Shadow of Debt Overhang: A Quantitative Perspective

„We document a hump-shaped relationship between sovereign debt and economic reforms, which motivates our theory of sovereign debt and structural reforms. We highlight three frictions: limited commitment (default risk), moral hazard in reforms, and incomplete financial markets (absence of GDP-linked debt). While debt smooths consumption, accumulating debt creates “debt overhang,” reducing reform incentives. Our calibrated model replicates empirical patterns in reforms, debt dynamics, and renegotiation.“
Andreas Müller is professor at the University of Bern and a teacher in the MIME program:
 
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Global Research Forum on International Macroeconomics and Finance 2024 (sponsored by the European Central Bank, the Federal Reserve Board and the Federal Reserve Bank of New York)
Tuesday, 12 and Wednesday, 13 November 2024, European Central Bank

This year’s Forum will focus on the central bank challenges implied by rising geoeconomic fragmentation risk and its consequences for global financial markets and institutions. 

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Call for Papers: Conference on „Europe, Asia and the Changing Global Economy„
14 – 15 January 2025 in Hong Kong, organized by The Hong Kong Institute for Monetary and Financial Research (HKIMR), the European Central Bank (ECB) and the Bank of Finland Institute for Emerging Economies (BOFIT).

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Really interesting! The literature on firms‘ and households‘ attention to macroeconomic data is growing.

„Firm Inattention and the Efficacy of Monetary Policy: A Text-Based Approach“ by Wenting Song (Bank of Canada) and Samuel Stern (University of Michigan) in the Review of Economic Studies.

„This paper provides empirical evidence of the importance of firm attention to macroeconomic dynamics. We construct a text-based measure of attention to macroeconomic news and document that attention is polarized across firms and countercyclical…As average attention varies over the business cycle, so does the efficacy of monetary policy.“

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„Monetary Policy with Persistent Supply Shocks“ by Galo Nuño, Philipp Renner, and Simon Scheidegger

„This paper studies monetary policy in a New Keynesian model with persistent supply shocks, that is, sustained increases in production costs due to factors such as wars or geopolitical fragmentation.“

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Geopolitical fragmentation in global and euro area greenfield foreign direct investment

Very interesting insights in this ECB bulletin by Lukas Boeckelmann, Lorenz Emter, Isabella Moder, Giacomo Pongetti, and Tajda Spital

„As firms and policymakers increasingly look at ways to reduce the vulnerability of their supply chains, understanding recent dynamics in greenfield investment is important as these may foreshadow a reconfiguration of global trade networks, the fragmentation of which could be particularly detrimental for the euro area.“

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Excellent speech by Isabel Schnabel (ECB) in Freiburg, Germany!

Escaping stagnation: towards a stronger euro area

„In recent years, growth in the euro area has become increasingly uneven. While monetary policy may have contributed to rising heterogeneity, it is not the main driver. Rather, structural headwinds are holding back growth in some countries more than in others.“

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U.S. Economy: No hard landing, and almost no soft landing so far
Just before the US presidential elections, the US economy is in a remarkably good state. Despite the rapid interest rate hikes by the Federal Reserve to combat inflation, a recession did not occur.