This paper presents research conducted within the Task Force on Low Inflation (LIFT). The task force is composed of economists from the European System of Central Banks (ESCB) -i.e. the 29 national central banks of the European Union (EU) and the European Central Bank. The objective of the expert team is to study issues raised by persistently low inflation from both empirical and theoretical modelling perspectives.The research is carried out in three workstreams:1) Drivers of Low Inflation;2) Inflation Expectations;3) Macroeconomic Effects of Low Inflation.LIFT is chaired by Matteo Ciccarelli and Chiara Osbat (ECB). Workstream 1 is headed by Elena Bobeica and Marek Jarocinski (ECB) ; workstream 2 by Catherine Jardet (Banque de France) and Arnoud Stevens (National Bank of Belgium); workstream 3 by Caterina Mendicino (ECB), Sergio Santoro (Banca d'Italia) and Alessandro Notarpietro (Banca d'Italia).The selection and refereeing process for this paper was carried out by the Chairs of the Task Force. Papers were selected based on their quality and on the relevance of the research subject to the aim of the Task Force. The authors of the selected papers were invited to revise their paper to take into consideration feedback received during the preparatory work and the referee's and Editors' comments.The paper is released to make the research of LIFT generally available, in preliminary form, to encourage comments and suggestions prior to final publication. The views expressed in the paper are the ones of the author(s) and do not necessarily reflect those of the ECB, the ESCB, or any of the ESCB National Central Banks.
In the struggle between the forces of free trade and the restrictive influence of insularism the latter recently seems to have the upper hand. This is illustrated by the referendum of June 23, 2016 where the United Kingdom (UK) voted to leave the European Union (EU). In this paper we evaluate the consequences of this event for EU integration. In particular, we analyze how the extent of EU economic integration would change once the UK leaves the Union. To that end we develop an integration benchmark that consists of the steady state production equilibrium characterized by arbitrage pricing and perfect factor mobility. We apply metrics to measure the distance between this benchmark and the data. We find that the integration in the EU is incomplete and its trend is non-linear while Brexit would not bring negative consequences to its development.
Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The Middle East was once seen as a medieval great globalized force. Nowadays it shows one of the lowest intra-regional trade in the world and therefore it is claimed that the region is poorly integrated. Yet, with the steady .ow of workers across national borders of the Middle East is this conjecture correct? To answer this question the paper develops an integration benchmark which consists of the steady state production equilibrium characterized by free trade and perfect factor mobility. We apply metrics to measure the distance between this benchmark and the data and compare three different regions of the world (EU, Latin America and Middle East). We find that, despite large differences in trade patterns, measures of economic integration in 2009 are remarkably close across regions. For example, we calculate that economic integration in the Middle East is just 2.4% below that of the European Union. Terms of use: Documents inJEL-Code: E130, F150, F210, F400, O110, O530, O540.
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