In our webinars and in-person events, members of the network or guests are invited to present. Interested persons can contact us.
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We are very much looking forward to this webinar with the world-renowned economist James Bessen!
Productivity growth has slowed in many advanced economies. Some economists have argued that „ideas are harder to find“ than in the past, which may at least partially explain slow productivity growth. Yoshiki Ando, James Bessen, and Xiupeng Wang challenge these arguments. They argue that R&D has become more effective at finding productivity-enhancing ideas, but these ideas may also render rivals’ technologies obsolete, making innovations more transient.
Webinar: The Rising Returns to R&D: Ideas Are not Getting Harder to Find (November 4, 16:00 – 17:00 Central European Time)
Webinar with James Bessen (Boston University), co-organized with the Swiss Productivity Monitor
James Bessen, an economist and technologist, serves as Executive Director of the Technology & Policy Research Initiative at Boston University. He has also been a successful innovator and CEO of a software company. Bessen studies the major economic impacts of technology on society, writing academic papers, magazine articles, and books. Bessen’s work on automation (see Learning by Doing, Yale 2015), both historical and current, provides a distinct analysis of effects on employment, skills, and wage inequality. Bessen’s work has been widely cited in the press as well as by the US White House and Supreme Court, the European Parliament, and the Federal Trade Commission.
Time: November 4, 16:00 – 17:00 Central European Time
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Our in-person event with Daniel Kalt (UBS Chief Economist Switzerland) on the Swiss economy and the economic effects of the US tariffs was super interesting and inspiring. Thank you very much, Daniel!
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Here is what our network liked (selection): The new causal macroeconomics of surveys and experiments, the euro and its history, the IMF World Economic Outlook, and much more…
The Fed and the ECB will soon decide on their interest rates. Most observers expect the Fed to cut interest rates by 25 bps, while the ECB will probably keep interest rates constant. In our polls, our community currently expects the same for the Fed and the ECB.
In the United States, the delayed inflation numbers for September were published on October 24. There is no spectacular news to tell. The CPI increased 0.3 percent in September compared to August (after rising 0.4 percent in August) and 3.0 percent compared to September 2024. Core inflation was 0.2 percent and rose 3.0 percent compared to September 2024. Overall, inflation was rather modest last month and is lower than many of us feared in the spring. Nevertheless, an inflation rate of three percent is still too high. There is a risk that inflation in the US will stay too high for a prolonged period of time and that long-run inflation expectations will move up.
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The Nobel Prize for Aghion, Howitt, and Mokyr is well deserved! So many relevant contributions to our understanding of economic growth.
Let us share here a recent paper by Aghion (together with Antonin Bergeaud, Timothee Gigout, Matthieu Lequien, and Marc Melitz) that is especially relevant against the backdrop of the recent rise in protectionism.
„Exporting ideas: Knowledge flows from expanding trade in goods„
„Overall, our results validate the notion that trade induces technological spillovers (in line with Coe and Helpman, 1995). And the results are also consistent with Cohen and Levinthal’s (1989) view that spillovers occur conditionally upon the recipient country exhibiting sufficient absorptive capacity. Our main finding that trade induces knowledge spillovers is in line with the notion that trade is a source of cross-country convergence. In addition, fostering development in the destination country increases the country’s ability to build upon the innovations brought by foreign exporters, thus inducing a reinforcing loop for productivity growth.“
A new book by Joel Mokyr (together with Avner Greif and Guido Tabellini) will be published soon: Two Paths to Prosperity: Culture and Institutions in Europe and China, 1000–2000.
This piece by Peter Klenow is highly recommended: Sustained growth through creative destruction.
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Wow, super interesting!
„Expectations Matter: The New Causal Macroeconomics of Surveys and Experiments: What people believe about the economy—and why it matters“ by Olivier Coibion and Yuriy Gorodnichenko.
„How do expectations about the future influence economic behavior? For decades, economists have known that beliefs play a central role—from how much households spend, to how firms set prices, to how central banks design policy. But figuring out exactly how expectations affect decisions has been one of the field’s most persistent empirical challenges.“
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This looks like a must-read!
„Inflation and monetary policy in medium-sized New Keynesian DSGE models“ by Günter Coenen, Falk Mazelis, Roberto Motto, Annukka Ristiniemi, Frank Smets, Anders Warne, and Raf Wouters.
„The paper takes stock of the evolution of medium-sized New Keynesian Dynamic Stochastic General Equilibrium (DSGE) models, which currently constitute the workhorse macroeconomic models used in central banks and academia. It focuses on how they can help analyse inflation dynamics, monetary transmission, and policy actions.“
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Studying economic history is highly relevant to understanding today’s world. This book on the euro and its history is super interesting and provides a valuable overview „for a lay readership with a background in history, political science, law or cultural studies as well as for economists who are interested in historical developments.“
„The Euro and its history“ by Stefan Schäfer, Ann-Stephane Schäfer, and Cory S. Wanek.
„The euro did not appear out of thin air, neither in 1999 nor during the famous Maastricht Conference in 1991. This book provides a detailed account of the euro’s extensive prehistory, tracing back to the end of World War II – an aspect often overlooked in existing literature.“
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Super interesting!
„Monetary Policy Shocks and Inflation Inequality“ by Christoph Lauper and Giacomo Mangiante.
„We find that the inflation rates of low- and middle-income households are significantly more reactive to monetary shocks than those of high-income households. Since at the same time, they experience a higher median inflation rate, contractionary shocks lead to an overall convergence of inflation inequality across income groups.“
By the way, Christoph is a graduate of the Master’s program in International and Monetary Economics. Highly recommended!
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The Swiss Federal Administrative Court ruled that the decree to write down the additional-tier 1 bonds (when UBS Group AG rescued Credit Suisse) was unlawful. This decision led to controversial discussions. The renowned business journalist and macroeconomist Fabio Canetg covered this case several times in his popular podcast (in German). By the way, Fabio Canetg is another graduate of the Master’s program in International and Monetary Economics.
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The Swiss government initiated the consultation on an amendment to the Financial Institutions Act. Switzerland aims to improve the attractiveness of the Swiss financial centre and to integrate innovative financial technologies. The government also clearly states that it wants to mitigate related risks to financial stability or consumer protection.
This short blogpost by Schellenberg Wittmer, one of the leading Swiss business law firms, gives a good introduction to the proposed amendment.
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Highly relevant!
„Monetary Policy and The Medium-Run Natural Rate“ by Vasco Cúrdia.
„This paper proposes a medium-run measure of the natural rate that averages out some excessive fluctuations, while retaining enough connection to economic theory to make it optimal under certain circumstances. The discussion also provides a framework on how to evaluate and meaningfully address concerns by policymakers regarding the natural rate. The results suggest that a medium-run measure that concentrates on natural rate fluctuations in the range of two to five years ahead can be reasonable empirically and theoretically.“
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Really cool! A new measure of Fed moral suasion!
„Official Arm-Twisting? Measuring the Federal Reserve’s Use of Moral Suasion“ by Emily Martell.
„Moral suasion refers to efforts by government officials to directly encourage, urge, or pressure private agents to take certain actions, rather than relying on formal policies to achieve those outcomes. Narrative evidence suggests that the Federal Reserve has frequently used moral suasion on financial institutions during crisis episodes. However, no measure of Fed moral suasion exists, and evidence on its predictors and effectiveness is limited. This paper leverages generative AI tools to construct a new measure of Fed moral suasion from financial industry newspaper articles from 1979 to 2024.“
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As always, the IMF World Economic Outlook is a must-read!
„The global economy is adjusting to a landscape reshaped by new policy measures. Some extremes of higher tariffs were tempered, thanks to subsequent deals and resets. But the overall environment remains volatile, and temporary factors that supported activity in the first half of 2025—such as front-loading—are fading.“
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Super interesting!
„Mapping the space of central bankers‘ ideas“ by Taejin Park, Fernando Perez-Cruz, and Hyun Song Shin.
„This paper explores the landscape of economic ideas as revealed in the machine learning embedding of a comprehensive dataset of central bank speeches. This dataset, maintained by the BIS, encompasses 19,742 speeches delivered by almost 1,000 officials from over 100 central banks over a period spanning three decades, from 1997 to 2025.“
„…we have conducted a series of analyses that map the global landscape of monetary policy discourse. Furthermore, we construct a quantitative framework—referred to as the „space of central bankers’ ideas“—which uncovers institutional patterns and highlights shifts in policy approaches over time.“————————————————
In case you missed our last Macro Bite, you can read it here. On our blog, you will also find our current assessment of the US economy.
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